prime - bombay stock exchange · 2018-09-24 · prime septel bel' 24, 2018 rporate...

PRIME

Septel bel' 24, 20 18

rporate Relationship Department ombay Stock Exchange Limited

Phiroze Jeejeebhoy Towers, Dalal Street, Fort, Mumbai 40000 I

Capital Markets - Listing National Stock Exchange of India Ltd Exchange Plaza, 5th Floor, Plot No. C/ I, G Block, Bandra Kurla Complex, Bandra (East), Mumbai 400051

Dear Sir,

Sub: Regulation 34(1) of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015

Re: Stock Code: 500337 (BSE) / PRIMESECU (NSE)

Pursuant to the provisions of Regulation 34(1) ofthe Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 20 15, please find attached the Annual Report for the Year ended March 31 ,2018.

This is for yo ur record and information.

Thanking you,

~ Ajay Shah Company Secreta (ACS- 14359)

Prime Securities Limited 1109/1110, Maker Chambers V, Nariman Point, Mumbai 400 021. CIN: L67120MH1982PLC026724 Website: www.primesec.com

Tel: +91-22-6184 2525 Fax: +91-22-2497 0777

PRIMEA pure-play, value-added,

financial advisory company

P R I M E S E C U R I T I E S L I M I T E DA N N U A L R E P O R T 2 0 1 7 - 1 8

Prime’s transformation is encapsulated in a simple

sequence of numbers

H cr, Net Worth, 2015-16



H cr, Net Worth, 2019-20E*

(34.36)

10.12

(4.32)

44.77

*Estimate based on the exercise of 70,00,000 warrants (entitling recipients to convert one warrant into one

equity share with a face value of H5) issued for H49.50 a share without factoring any impact of the

Profit & Loss account of 2018-19 and 2019-20.

THINGS YOU NEED TO KNOW ABOUT

PRIME SECURITIES LIMITED

81 Ethos

Vision: To be recognised as a group founded by knowledge, guided by integrity, nurtured by experience and driven by passion to provide personalised solutions in investment banking, and corporate advisory services.

Mission: To achieve our objectives in an environment of fairness and equity towards our clients, employees and society at large

Core values � To build a financial

institution based on

client intimacy, product leadership, service and operational excellence.

� To build a knowledge-driven business and encourage creativity, offering bespoke financial solutions for clients and endeavour for superior returns.

� To maintain the highest possible standards of ethics and integrity in corporate governance.

� To inculcate a meritocratic work environment with respect for individuals, fostering teamwork and collaborative efforts.

� To inspire a sense of ownership and commitment among all team members and cultivate a corporate culture of excellence. Our clients’ interests come first.

2 Focus

Prime Securities is a leading provider of diversified, investment banking and corporate advisory services, licensed and regulated by the Securities and Exchange Board of India, authorised to advise and arrange financial services under a Category-1 merchant banking license.

Prime Securities Limited2

3 Management

The Company’s senior management includes N. Jayakumar (Managing Director, Prime Securities Limited), Vineet Suri (Executive Director, Prime Securities Limited), S.R. Sharma (Managing Director, Primesec Investments Limited), Akshay Gupta (CEO & CIO, Prime Research and Advisory Services Limited) and Puneet Pandey (Managing Director, Prime Research and Advisory Services Limited). The Company is headquartered in Mumbai, India’s financial capital.

4 Offerings

The Company is engaged in providing services that address the apex of the consulting pyramid in terms of organisational criticality, fees and repeat engagement possibility. The Company also offers value-added advice to clients on complex strategic and financial decisions and transactions focused around fundraising, mergers and acquisitions, private equity

and debt placements, initial public offerings, corporate advisory and capital restructuring. The Company’s team engages in due diligence, negotiating and closing financial terms individually to cater to client needs and capital market demands.

5 Clientele

Prime Securities Limited has developed a strong client roster comprising prestigious Indian customers like Balrampur Chini Mills Limited, Apollo Hospital, Indraprastha Hospitals, JSW Steel Limited, Pantaloons Retail (India) Limited, Edelweiss Financial Services Limited and Dewan Housing Finance Limited, among others.

6 People

Prime comprised a focused team of 17 (as on 31 March 2018) with key executives involved in every transaction and without the people-intensity of large organisations. The Company’s agility was

reflected in a flexible, nimble, market-driven team constantly reacting to market stimuli and client needs with eyes and ears trained to capture moods and sentiments.

7 Customers

The Company has been engaged in long-standing relationships with domestic and international clients, including corporations, foreign institutional investors, financial institutions, banks, mutual funds, insurance companies and high net worth individuals.

8 Listing

The Company has been listed on the NSE and the BSE since 1994. The Company enjoyed a market capitalisation of H125 crore as on 31 March 2018.

Annual Report 2017-18 3

THE HEALTH OF OUR BUSINESS

ConsolidatedIncome from operations(H Crore)

Consolidated

EBITDA(H Crore)

Consolidated

Cash Profit(H Crore)

Consolidated

Profit / (Loss) before tax(H Crore)

*20

13-1

5

*20

13-1

5

*20

13-1

5

*20

13-1

5

2.4

8

(5.7

9)

(14

.70

)

(15.

08

)

20

16-1

7

20

16-1

7

20

16-1

7

20

16-1

7

16.9

6

6.3

8

13.5

4

19.3

5

20

15-1

6

20

15-1

6

20

15-1

6

20

15-1

6

10.4

1

(5.9

5)

15.0

4

14.8

3

20

17-1

8

20

17-1

8

20

17-1

8

20

17-1

8

23.

11

15.3

6

14.4

5

17.1

5

*Financial Year 2013-15 was a period of 18 months from (01-10-2013 to 31-03-2015)


Ratios

Balance Sheet ratios

Ratios *2013-15 2015-16 2016-17 2017-18

Earnings per share (H) (5.75) 5.36 5.06 5.39

Book Value per share (H) (5.52) (0.15) (1.63) 3.82

Profitability ratios

Margins *2013-15 2015-16 2016-17 2017-18

EBIDTA margin (%) (233.29) 57.21 37.62 66.46

Net profit margin (%) (613.47) 136.42 79.11 61.89

Return on assets (%) (1,585.52) 1,428.46 167.21 151.54

Return on capital employed (%)

(8.88) 6.71 50.28 84.82

Return on equity (%) 104.20 (3510.34) (310.55) 141.34

Liquidity and solvency ratios

Ratios *2013-15 2015-16 2016-17 2017-18

Debt-equity ratio (including working capital)

(7.52) (219.97) (3.93) 0.79

Debt-equity ratio (only long-term debt)

(1.18) (9.97) (0.95) 0.21

Interest cover (3.17) 762.17 286.36 820.43

Market capitalisation, March 31, 2018 (H Crore)

Enterprise value, March 31, 2018 (H Crore)

125 127.61

Above ratios are based on Consolidated Financial Accounts*Financial Year 2013-15 was for a period of 18 months from (01-10-2013 to 31-03-2015)


CHAIRMAN’S OVERVIEW

B Y P R A D I P D U B H A S H IChairman & Independent Director


I t is with some satisfaction that I forward the Annual Report for FY’2018. As you would note your

Company has continued to do well; on consolidated basis the return on capital employed has substantially improved, the return on equity has decidedly turned a healthy positive and so has the Book Value per share. I am confident that this trend will continue.

>>


Business environment

The influence of the economy is overarching in the financial advisory business. GDP growth was rather muted at 6.7% in 2017-18 as against a forecast of 7.1%. Oil price increased and its effect on fiscal deficit and currency, business process adjustment on a gargantuan national scale due to the introduction of GST, credit stall because of debt recovery worries, inflation worries and interest rate hikes by RBI in its wake did serve as speed breakers. Political fragmentation and a stall in parliamentary processes also contributed to the slowdown.

Uncertainties continue

Many of these uncertainties continue. Disturbances in global trade initiated by the US administration policies and sanctions imposed on Iran have exacerbated local uncertainties. What happens if the Iran oil supply is taken out? What happens to the INR if there is a currency war? Continued depreciation, engineered or otherwise, of the Chinese Yuan and

reaction of the US, make any take on the global economy dangerous. As if this was not enough, some respected economists have been talking of a shrinking world monetary base (US$) and how it could lead to a global recession in 2019! In the midst of this doom and gloom, the Indian economy is expected to grow at 7.3% or so. The IMF report on the Indian economy has rather graphically said that the ‘Indian elephant has begun to run’.

Our Company’s mission continues

As Mr. Jayakumar explained last year, it is difficult for company managements to make sense of these rapid changes, let alone proactively react to them. Your Company has lent a helping hand to some of those affected with timely advice and creative execution. A lot of work that your Company does is non-mandated; it means that many a time we seek out clients likely to run into road blocks. It is not that we have a solution that is in search of a problem

with a particular sector; the Company’s client portfolio is diversified with about 50% drawn from service sector, 39% from manufacturing and 11% from trading. Think of it this way, whether it is an aspirational situation or one of desperation, your Company’s team has some solid service to offer!

New lines of business

During the year under review, your Company decided to move into adjacent lines of business like value-added intermediation services in wealth management for Corporate Treasuries, Fund Management companies and Family Offices. Such moves are common; what is slightly different was the path we took. Instead of building capability ground-up, we welcomed a well experienced and networked team into our fold and housed it in Prime Research and Advisory Limited, a subsidiary. Your Company hit the ground running with a client base, annuity income and a profitable operation. The complementarity is vivid; wealth management is incomplete without

>>


financial advisory and investment banking. Similarly, financial advisory clients are an excellent catchment area for wealth management services. Annuity income from this business, moreover, could smoothen current chunky revenue streams from transaction-led advisory fees.

Organisational changes

With this induction of a new team in a subsidiary, your Company’s team is more than doubled. It is expected to more than double over this year and that too in different geographies. To meet this challenge, your Board re-designated Mr. Jayakumar as MD & Group CEO. All MDs and EDs, including of subsidiaries, shall report to him.

We also persuaded Independent Director Mr. Subramaniam Sharma to take over as MD at Primesec Investments Limited, a subsidiary that shows promise and needed enlightened leadership. We continue to receive his wise counsel as he continues as a Non-

Executive Director on this Board. In Q1 of the current year, we also elevated Mr. Vineet Suri, a veteran in Corporate Finance, to the Board as an Executive Director.

The services that we provide, and that includes new ones added, require our clients to repose complete confidence and trust in us. The expansion in services and growing numbers in the team means your management needs to reassess the ‘risk management’ framework on an urgent basis and put changes in place. The board has directed the management to urgently reassess the Risk management structure and processes across the group including the subsidiaries. Mr. Subramaniam Sharma is heading this effort and his long experience in Shinsei Bank of Japan would serve us well. This, hopefully, will be done in the coming

quarter.

Corporate governance

Corporate governance has been centre stage in public discourse.

Whenever a situation has arisen, a constant refrain of all is ‘What were the Independent Directors doing?’ In a Company like yours, which has no promoter (one among very few), the Independent Directors need to shoulder a disproportionate burden to ensure regulatory hygiene. Governance becomes less of providing leadership and oversight and, as one of my esteemed colleagues pointed out, more of policing. My colleagues and I on the Board have been having constructive debates on these issues. Irrespective what is said or unsaid, in your Company governance ethos is like atmospheric pressure; always 14 pounds to a square inch. I have to thank my colleagues for that.

Please write in if you have suggestions and views!

[email protected]

Your Company hit the ground running with a client base, annuity income and a profitable operation.


MANAGING DIRECTOR AND GROUP CEO’S

OVERVIEW

Prime Securities and the power of manthan

I am tempted to invoke mythology when starting with a review of where Prime

stands and where it intends to go.

In Hinduism, one of the central events in the ever-continuing struggle between the gods and the demons was the churning of the ocean of milk. The churn generated wealth from the ocean depths – the moon, a beautiful fragrant and heavenly tree, Lord Indra’s four-tusked elephant, a cow of plenty, the goddess of wine, a wish-fulfilling tree, celestial dancers, a celestial

B Y N J A Y A K U M A RManaging Director and Group CEO


horse, the goddess of wealth, Lord Vishnu’s conch, mace and magic bow, various gems and the physician of the gods transporting nectar.

At Prime, this is the most faithful analogy that I can find for what we are and what are trying to do. Our principal objective is to churn the ocean of relationships that we enjoy with our customers, making it possible to generate multiple opportunities from the same customer, translating into enhanced revenues. In churning these relationships comprehensively and generating superior revenues, we don’t just expect to generate one-time fees; we also expect to generate a sequence of revenues from the same customer (the closest we can get to annuity), the basis of business sustainability.

Widening the platform

At Prime, we took this initiative ahead during the last financial year when we widened our operating platform. During the earlier year, we had one business vertical of corporate finance and restructuring, which we churned with the objective of generating more business leads from within customers.

We churned our corporate finance restructuring business through the following priorities: nurtured customers for potential deals, increased the number of deals and generated a larger wallet share. We leveraged our advisory capabilities and showcased our complete skill set, addressing progressively complex restructuring assignments. In doing so, we strengthened our brand in a space marked by low competition and reported growth in every business segment quarter-on-quarter.

I am pleased to share that we did well in this regard. By the close of the last financial year, our concurrent 25-deal pipeline was higher than at any time during the last twenty years; the number of in-process deals was twice the number we had closed during the last financial year; the average ticket size per transaction was appreciably higher than in the past and half a dozen customers of the last financial year extended into the second round of their engagement with us.

In this business segment, we will continue to focus on companies needing to restructure their Balance Sheets, providing them with

solutions that strengthen their businesses. We will negotiate on their behalf with banks for lower debt costs or longer debt tenures or moratoriums that provide the affected companies with a breather before they return to profitability and debt repayment.

The acquisition

While most companies would have preferred to consolidate their presence across this business vertical during the nascent stage of our corporate reinvention, we went one decisive step ahead during the last financial year. We embarked on the acquisition of an independent wealth advisory firm, which became effective from 1 April 2018. This wealth advisory company is business-strengthening for Prime: the team brings with it a distinctive customer set, a profitable business and more importantly, an attractive net worth following the acquisition of shares of our company.

The result is that during the acquisition of this business, we replaced the conventional cash outgo model or the equity dilution model; we combined equity dilution with attractive net worth


infusion at terms that we believe are value-accretive for our company. This differentiated approach will strengthen our overall net worth – from (H34.36) crore in 2015-16 to an estimated H44.77 crore at the close of 2019-20 when the warrants given to the incoming partners are likely to have been exercised (without accounting for the earnings the parent company and this subsidiary are likely to report during the intervening period).

Attractive synergy

What makes this deal attractive is the synergy between our existing corporate finance advisory business and the wealth advisory business. The addition of the wealth advisory business was imperative for widening our operating platform. The wealth advisory piece is a critical component of the Prime of the future; it will provide us with the flexibility to extend from being mobilisers of capital for customers needing our restructuring services to becoming deployers of capital on behalf of high net worth customers seeking investment solutions. The ability to be on both sides of the table will make it possible for us to address a wider range

of opportunities, increase the customer touch-points and more effectively leverage the power of customer relationships. In the wealth advisory business, we will increase our presence across family offices and market a wider range of NBFC and mutual fund products.

Conducive for business

The overall environment is becoming increasingly conducive for our business. A number of banks under Prompt Corrective Action are inadequately capitalised, finding it difficult in disbursing credit to corporates. This enhances the relevance of a range of NBFCs who are nimbler in providing funding cum advisory solutions to customers. Prime sits at an attractive sweet spot in this scenario. By virtue of being a non-fund-based advisor, Prime will continue arranging funds for its customers coupled with knowledge-based advisory value-addition. By providing an intermediation service that comprises raising capital plus knowledge, the Company is positioning itself as being more effective than conventional fund providers. This competence is translating into a distinctive industry respect. Prime leverages

its vast network; the result is that the Company has attracted deals from peer companies, validating its deep competence.

Besides, the business environment continues to be fluid. The implementation of GST in 2017-18 affected offtake and business sentiment. The volatility of the Indian currency affected strategic planning stability of a number of companies. The appreciation in the cost of oil affected margins of most industrial players. The global trade war can have extensive ramifications for a number of companies. The cost of debt has begun to rise in India, threatening debt-heavy Balance Sheets. A sharp sell-off in the mid-cap space in the first half of 2018 deferred the fund-raising plans of a number of companies. These realities warrant a deep advisory engagement to help companies proactively evolve their business models to stay competitive.

Road map

Going ahead, our business-building initiatives will comprise the following: we will continue adding complementary non-fund businesses to our operating platform with the objective of


generating a third of our annual revenues from segments that did not exist within our company three years ago. We will make select recruitments of senior professionals. We intend to widen our geographic presence beyond our Mumbai positioning that makes it possible for us to get closer to customers pan-India. We intend to enhance people productivity through a larger sharing of functional responsibilities. We intend to generate a growing

proportion of revenues from repeat engagements with the same customer (the closest we can get to annuity revenues). We intend to cap our total costs as a percentage of revenues to half the sectoral average. We will continue to focus on the maximisation of RoNW (return on net worth). We will continue to focus on generating incremental net worth without using our Balance Sheet. We will continue to build our treasury corpus or buy out complementary

businesses, enhancing shareholder value through various progressive options.

On the overall, we intend to build Prime as a progressively multi-vertical, non-fund-based consulting and full service corporate, wealth and investment advisory company that is attractively profitable, enhancing value for all those who own shares in our company.

1 Deal quantum: Prime intends to enhance the deal quantum, the increased throughput translating into enhanced revenues and profits.

2 Platformisation: Prime is engaged in the creation of a consolidated platform of non-fund advisory services, each synergistic, making it possible to carve out a larger share of the customer wallet.

3 Deal ticket size: Prime intends to increase the average ticket size of each deal through progressively complex engagements that generate commensurately higher fees.

4 Holistic people remuneration: Prime intends to strengthen its remuneration mix – through direct means (salary cum performance bonus) and through wealth generation (ESOS), enhancing people retention, which is the lifeblood of a network-driven business.

WAYS IN WHICH WE EXPECT

TO ENHANCE SHAREHOLDER

VALUE

4


P R I M E R E S E A R C H A N D A D V I S O R Y L I M I T E D

OUR WEALTH MANAGEMENT AND

INVESTMENT ADVISORY BUSINESS

The wealth management and investment advisory business of

Prime Securities became effective from 1 April 2018.

B Y A K S H A Y G U P T ACEO and CIO


T he recent extension of Prime’s business model took the

Company from its core business of corporate finance advisory to wealth management.

The wealth management space in India came into its own across the last decade. Consider the realities: a decade ago, there were only 100,000 dollar millionaires (based on disclosed reports); this has increased to around 350,000 today and is expected to grow to 500,000 by 2022.

The same growth has been reflected on the institutional market side where the size of the treasury (across all asset classes) was about US$ 50 billion about a decade ago; this market has since grown to about US$ 250 billion today.

Positive disproportionate relationship

We believe that this substantial growth has been achieved out of a positive disproportionate relationship between GDP growth and individual wealth creation: where the country’s 7% GDP growth translates into a significantly higher accretion in the wealth of individuals.

At the heart of this substantial outperformance lies the country’s transition from investment in physical assets to financial assets and from investment in simple financial products to the sophisticated.

The conclusion is that as India transforms from a US$ 2.5 trillion economy into a US$ 7 trillion economy by 2030, there would be a considerably larger role in the intermediation of wealth management and investment advisory, inspiring the observation that perhaps we have not seen anything yet.

Gaps mean opportunities

At Prime, even as we see a considerably larger market building up for wealth management, we also see a number of gaps – advisory, service and knowledge – that provide opportunities for players like us.

One, we see a low understanding of markets among Relationship Managers, translating into an inability to consummate the full potential of customer relationships.

Two, we see a mismatch between the sizeable quantum of assets under management (AUM) and

the inexperience of the service providers.

Three, two of the largest wealth management companies in India were not even present a decade ago, indicating that the sector is still an evolving market and the competitive edge is in being nimble and yet working relentlessly on customer delight.

Four, the nature of products has gone through a sea change across the last decade, warranting new skills in analysis and presentation.

Five, we perceive a short-term and singular focus on selling financial products without a commensurate commitment to service, solve consequential issues and hand-hold clients during the relationship tenure.

Prime’s differentiated proposition

Prime is bringing a differentiated proposition to this sectoral reality.

The business provides a unique one-stop solution for customers, comprising the in-sourcing of solutions across all asset and domain classes (equity, debt, tax, insurance, foreign exchange and real estate etc.) and solutions encompassing multiple


geographies as opposed to a number of service providers who select to outsource some of the services. The fact that we selected to in-source all these services from the day we went into business only indicates our long-term approach and priority in providing the customer with a single-point solution.

The business is focused on the creation of a knowledge-driven business where the edge is derived from owning distinctive intellectual capital.

The business will focus on the building of credible indices by which financial instruments may be transparently appraised, providing investors with an insight into the quality of financial instruments being offered and enhancing trust in the intermediation ecosystem.

The business comprises promoters who are not only driving the business but also own equity in the Company; this indicates that a reconciliation between the professed values and strategic implementation

– a commitment to not sacrifice impartial advisory services at any count.

The attractiveness of our business model is that the business will be cash-accretive from the first year, will not draw on the resources of the Balance Sheet, will generate a high Return on Equity and is competently placed to generate annuity revenues across the long-term.

Complementary value

Besides, the wealth management business brings a completely complementary capability to Prime’s corporate finance advisory business. Prime enjoys a large number of corporate and individual relationships that will now be addressed by the Company’s wealth management business. The acquired company’s critical mass of business represents seed business that will kick-start growth from day one, which would otherwise have taken a few years.

The business intends to invest in the following initiatives during the current financial year:

while the existing team will continue to manage institutional clients and family offices, there will be a focus in acquiring individual high net worth clients. The business intends to grow the number of wealth management professionals from 12 to 50 across two years. The business will protect its nimble mid-sized scale marked by responsiveness and knowledge cross-flow. The business will extend its coverage across diverse asset classes (debt, equity, real estate, commodities, foreign exchange and international products). The business will comprise assets under management and assets under advisory, generating attractive fee revenues.

In doing so, we expect to build a business that is profitable and valuable across the foreseeable future.

Besides, our vision is to create a happy company marked by low attrition of employees and customers, translating into business sustainability.

What attracted me to join Prime Securities

� Assurance of below industry-level attrition � No short-changing clients � No coercing of employees to generate business at any cost � A neat fit of values and culture


THE CONVENTIONAL AND PRIME: THE

CRITICAL DIFFERENCE

Conventional Prime Securities

Fund-based businesses Fee-based

Over-crowded markets Relatively niche space

Declining margins Growing margins

Affected by technology-driven competition

Insulated form technology-based competition

Asset-based /cash-based Knowledge-driven

Patchwork solutions One-stop solutions

No room for differentiation Room for innovation

Transaction-drivenRelationship-driven (retainers)

Leverages the Balance Sheet

Does not leverage the Balance Sheet

Cash-intensive Cash-accretive

High people expense ratioRelatively low people expense ratio


WAYS IN WHICH THE PICTURE HAS CHANGED AT PRIME SECURITIES

B Y V I N E E T S U R IExecutive Director, Prime Securities Limited,

Head of Corporate Finance & Investment Banking

51 The Company diversified from last year’s focus on debt-raising advisory and restructuring activity to other corporate finance and investment banking services. With its extensive product expertise and structuring niche, Prime advised customers on transactions including various equity placements, strategic advisory mandates (M&A, promoter stake sales), etc while continuing to work on structured debt mobilisation and debt/capital restructuring assignments. With developments in markets, businesses and customer requirements, our ability to provide product solutions across the spectrum has come into full play.

2 The Company’s focus has always been on maintaining long-term customer relationships. We have seen an addition of a number of new customers where a relationship has begun with an idea for a single assignment, but has developed into a closer rapport where Prime has become the port of call for investment banking and other advisory

needs or even simply discussions on ideas. While this relationship-focused DNA at Prime has not changed, our ability to attract marquee names has been gratifying.

3 Our recent strategic integration with Prime Research and Advisory Limited makes it possible to enter into new business areas. Prime’s competence lies in the generation of assets; PRAL’s competence lies in the placement of debt with fund managers and its other wealth management customers. The accretion of PRAL’s distribution platform represents an exciting

synergy.

4 During the year we enhanced our ability to execute mergers and acquisition deals, now covering international buy-side and sell-side counter-parties. This was made possible through a tie up with professionals who once worked for marquee international institutions, drawing on their extensive client network. This greatly enhances Prime’s strategic and financial investor relationship strengths.

5 There is high enthusiasm at every level of the Company, with new additions to the core team. These developments have played a large part. Our unique strengths in complex transaction management and our ability to provide customers with a bouquet of products and services have transformed Prime Securities into a full-fledged Corporate Finance & Investment Banking house.


GOVERNANCE AND PRIME

W hen I joined Prime as Director in 2015, the principal story at the

reinvented company was as much about building back as it was about building right. This messaging was evident through newly defined business priorities: the decision to move away from fund-based businesses to a fee-based consulting business, a focus

on process-led diligence that translated into extensive information availability during Board meetings and reviews of all significant deals the Company engaged in during the preceding quarter. The result was that even as the Board was collaborating with the Prime leadership team in charting out a new strategic direction for the Company, there were tactical reviews in every Board meeting.

I have been struck by the humility of the Prime leadership, that sought to make significant changes in their business model, took ownership of previous issues and led the organisation from the front with financial austerity and a dedication to build from scratch. The fee-based business model needs to be understood better. Prime is a highly profitable company, even when compared with many firms with over 10 times its revenue.

I accepted the Directorship at Prime because of the nature of its turnaround story. Over successive quarters I have been pleasantly surprised by the tremendous energy in the Company. As a result, there is always something new happening in each quarter – a significant deal or an acquisition.

I find it educative and invigorating to be on this active and engaged Board!

B Y A L P A N A P A R I D AIndependent Director


GLOBAL BLACK SWANS AND THE BUSINESS

OF PRIME SECURITIES

T he one operative word driving the business model of a company like Prime Securities is ‘uncertainty’.

This uncertainty has been derived from an unprecedented convergence of diverse changes in the social, political, business, technology, labour and demographic landscapes the world over.

During the last couple of decades, increased globalisation has made it increasingly imperative for even local companies to be globally competitive.

Trade wars

Terrorism

Automation

Climate change

B Y S R S H A R M A Managing Director, Primesec Investments Limited


Even as markets have become larger, the tenure of economic cycles has shortened. The widening footprint of terror has introduced a new dimension to global business. The accelerated pace of technology has resulted in a number of globally large companies disappearing into anonymity. Increased robotisation is threatening jobs, incomes and life stability. Interest rates have broadly increased the world over, affecting companies nursing large and expensive debt. A number of conventional sectors (especially based around fossil fuels) are staring at probable obsolescence as the age of renewables takes over. Platform-driven businesses (like Uber, Netflix and Airbnb) are threatening conventional brick and mortar equivalents. As capital abounds and product abundance becomes a visible reality the world over, a long-term deflation is a possibility.

Companies increasingly vulnerable

The result of this unprecedented transformation is that a number of companies that were once comfortable with the old order are now vulnerable; a number of

these companies are over-borrowed with virtually no room to grow their businesses.

In India, this transition in ground realities has been coupled with refreshing government urgency in addressing companies unable to meet their financial obligations. Conventionally, these companies would borrow afresh from banks to liquidate erstwhile dues, postponing their moment of truth. In a transforming India, banks are now being required to state the complete extent of non-performing assets on their books while companies are required to either restructure with the intention to repay or file for bankruptcy.

The need of the day is specialised consultancies that can work closely with debt-strapped companies on the one hand and bankers on the other with the objective to design and execute win-win solutions: help companies restructure their Balance Sheets to enhance their debt repayment capability and make it possible for banks to recover their dues.

Business attractiveness and Prime

This business is attractive given its long-term

relevance. There is a large volume of debt waiting to be restructured. There is a growing need for intermediaries to provide a complete restructuring solution as opposed to piecemeal patchwork services. Since each case is usually different from the other, there is a growing need for customised innovation.

Prime Securities is one such specialised consultancy that comprehensively and competently addresses this reality. The Company is a pain-point expert with a growing track record of assisting companies out of a strategic gridlock and helping banks recover dues that at some point may have appeared difficult to recover.

Prime is focused, nimble and muscular; the nearest analogy that I can evoke is that Prime Securities is like a commando unit within a large army; this special force possesses unique competencies, is provided focused assignments, works independent of the army and is respected for its ability to complete projects with clinical efficiency before being deployed to other projects.


OUR CULTURE

A t Prime Securities, we believe we possess a distinctive culture that makes it possible for us to attract/retain people more effectively on the one hand and address client needs more efficiently on the other.

Entrepreneurial: At Prime, there is a distinctively entrepreneurial culture. The team has complemented academic soundness with the ability to bring innovative ideas to the table. The result is a company perpetually working with new concepts and cutting-edge business developments.

Governance: At Prime, it would have been easy to disregard processes in the pursuit of growth opportunities and dynamic market realities. This is the temptation that Prime has not yielded to. The Chairman has consistently prioritised the need for systems over ‘ad hoc-ness’, bring a sense of method into the ‘madness’ (so to speak).

Diversity: At Prime, it would have been convenient to have like-minded people generally tending to agree on things. This is another point that makes Prime different: the diversity of Board members who help in bringing different ideas to the table. It is not necessary to have all members nod their heads in agreement to what is suggested or proposed; what is more important is an active debate, the ability to appreciate alternative points of view and a capacity to resolve those differences in line with the stated objective of the Company.

Go-getting: At Prime, one of the things I quite admire is the ability to be always on the ball, addressing contemporary issues that most customers face. We describe our service as ‘two steps ahead’, making it possible to lead clients than merely follow a script. We are driven by a greater need to accomplish what most clients, experts and observers would consider improbable, leading to enduring solutions and respect. This provides the optimism that the Company will keep growing in a sustainable way year-on-year.

Culture: We embrace complex assignments; we are consistently punching above our weight with the conviction that we can draw into our wide network and experience to create win-win solutions

B Y A N I L D H A R K E RIndependent Director


C A S E S T U D Y # 1

C A S E S T U D Y # 2

HOW PRIME’S ONE-STOP SOLUTION EMPOWERED A CLIENT TO GRADUATE TO THE NEXT ORBIT

‘NO ONE UNDERSTOOD MY COMPANY THE WAY PRIME DID’

In 2017-18, a prominent company needed to mobilise a large quantum of funds across a period of time to widen its geographic footprint. The challenges were many: the Company needed to widen its relationship beyond its existing consortium; it needed to work with different bankers who offered different rates; it needed to banks to extend beyond their initial assurances to

actual disbursement; it needed a prompt access to funds that would make it possible to address business opportunities; it needed funds across an extended tenure that would provide working capital comfort that would preserve cash flows during the productive nascent phase of the Company that could then translate into attractive business sustainability. The Company eventually

turned to Prime. Prime advised the client on the entire process. Prime advised the client on the business side and the financial side – a holistic one-stop solution. The result is that the Company mobilised the necessary funds, strengthened its business model through strategic changes and is now better placed to climb into the next orbit.

The aging promoter of a successful Western India company desired to divest his stake and exit the business. The only stipulation of the promoter was that the Company’s management be transferred to a competent incoming owner who would take the business ahead. The promoter had spoken

to a number of financial intermediaries; they had failed to find a competent suitor. The promoter turned to Prime; he gave Prime only 48 hours to study his company’s fundamentals and provide a recommendation. Prime puts its team at work, comprehending the business model. Prime meanwhile began to

leverage its vast network: the result is that within 72 hours, Prime was able to identify a potential buyer. When the transaction had been completed, the erstwhile promoter paid Prime a compliment: ‘No one understood my company the way Prime did.’


E N D O R S E M E N T

“WE HAVE BEGUN TO LOOK AT PRIME AS OUR LONG-TERM

THOUGHT PARTNER.”

N ational Plywood, my company, had been de-

listed for 14 years after having suffered industrial sickness following a Supreme Court ruling in the late Nineties. We retrieved two of the Company’s manufacturing five facilities as well as our brand through this challenging transition. We did so with the expectation that we would be able to revive the Company and lead it to its rightful place in India’s interior infrastructure sector.

There was just one problem in our proposed recovery: bank funding would take time despite assurances; we were

averse to increasing debt during our recovery phase. The problem was that since few knew of our story and prospects, the chances of mobilising net worth appeared bleak.

In this challenging phase, Prime Securities proved to be our lifeline.

Prime did not just provide us with an access to precious net worth; it provided us with access to respected private equity players as well. The result is that we were able to access financial and intellectual value - both. These prominent private equity players were instrumental

in providing us with the benefit of their extensive network and their knowledge about the evolving and demanding standards of governance.

As it turned out, Prime extended beyond the standard call of duty; it didn’t just provide us with net worth to kick-start our operations; it introduced us to select professionals who brought excellent value to our table that has since invigorated our corporate vision. We have begun to look at Prime as our long-term thought partner – someone sitting in India’s financial capital batting for us while we focus on our core business.

B Y P I Y U S H P E R I W A LManaging Director,

National Plywood Industries Limited


B U S I N E S S M O D E L

THE DISTINCTIVE WAY IN WHICH WE DO BUSINESS AT PRIME

Focus

At Prime, we believe that consistent business focus is key to long-term success. At one level, we believe that the country’s financial services business is largely under-penetrated, making it an excellent growth proxy in a growing economy. At another level, we believe that within the country’s financial services space, there will be under-penetrated and under-populated niches that are relatively under-addressed. We wish to be present in these niches, bringing to it a complement of professionalism, network strength, listed visibility and governance.

Revenue flows

Prime’s revenue flows are lumpy when seen from a quarter-to-quarter perspective, marked by the possibility of some transactions spilling from one quarter to another. However, an annual perspective may provide a better index of the Company’s progress.

Integrated

Prime provides an integrated solution – advisory and implementation. This is analogous to the roles played by a General Physician and a surgeon – one diagnoses and the other operates. The integration of roles makes it possible for Prime to conclude assignments faster and more completely.

Uncertainty-driven

At Prime Securities, our business model is directed at helping companies restructure to erstwhile health through innovative solutions. In a world of variables. There is a growing focus on finding an innovation-driven resolution that benefits lenders and client companies.

Non-fund-based business

The Company will continue to focus on the growing opportunities coming out of non-fund intermediation as

opposed to companies where the non-fund side of the business is a small component of the overall business mix. This focus is enhancing our business clarity on what we wish to be – a company that does not need to leverage the size of its tangible Balance Sheet to grow but leverages the intangible competencies resident within its business.

Lumpy

Even as our deal inflows have been continuously growing, our revenues and profits may often be lumpy quarter-on-quarter based on certain delays in assignment closures or advances being reported in the following quarter.

Solutions

Prime provides restructuring services that address the apex of the service consulting pyramid with regard to the customer organisation’s criticality. The Company brings to the customer’s table a competence across domains (manufacturing, engineering and finance).


The solution comprises the competence of an innovative solution as well as win-win proposition (for client and lender) coupled with effective implementation. One successful solution retains the potential of a number of business referrals and retainer-ship engagements.

Network-driven

The Company’s business model – where the net worth on its Balance Sheet is secondary to its organic growth prospects – is driven by the power of its collective network. This network is a potent driver in opportunity identification, competent analysis and the ability to work with different agencies in the pursuit of a singular objective. At Prime, the key management brings more than two-and-a-half decades of exposure to peers, capital providers, capital deployers and policy makers – its network – for the benefit of customers. The focus on network size and quality is also a critical determinant in the Company’s decision to pursue specific inorganic growth leads.

Flexible

At Prime, we recommend the use of debt and equity resources in creating a restructuring solution for the benefit of our client companies and their lenders. This goes counter to a number of peer consulting companies who are restricted by the use of debt or equity and hence are restrained from providing a complete solution.

Service network

At Prime, our objective is to provide a single-stop solution to our customers. On most occasions, this competence is resident within the Company. However, in specialised instances requiring an opinion or intervention that is niche, there is always a possibility of seeking the intervention of some of the most competent minds in the country. At Prime, we possess a wide and deep network of professionals who are not our employees but who we enjoy an access to. This network of associates makes it possible to address virtually any kind of challenge that our customers face – through the interplay of

in-sourced or outsourced competencies.

Intellectual capital-driven

While all businesses are driven by knowledge of their specific spaces, this is more evident in the business of non-fund advisory services where the Company must enhance sustainable value through the interplay of its network, ferret likely leads, make a non-mandated first-mover pitch to the Company, propose a solution for the pain point and leverage proprietary capability in implementing a timely solution. The Company’s executives possess a rich network across all players in the financial ecosystem (companies, bankers, private equity funds and financial consultants), a rich understanding of the national business landscape, Balance Sheet mechanics, restructuring experience and distinctive communication clarity, providing customers with the optimism of transformative potential.

First-mover

The Company believes that in a competitive space, success is derived


from the ability to approach a prospective client with a solution for an existing business challenge than be one of a number of advisory agencies being approached by the Company. We believe that the former non-mandated approach makes it possible for the Company to ring-fence itself from competition and in doing so, escape pricing pressures – the ability to be remunerated commensurately for intermediation services provided. Nearly 90% of the Company’s revenues were derived through non-mandated pitches in 2017-18.

Responsiveness

The business of non-fund advisory services usually addresses companies in distress. Most of these companies usually turn to specialised advisory agencies as a last resort at virtually the last stage. This scenario prioritises the need for responsiveness. At Prime, we pride on our speed: by the virtue of being selective in deal adoption, we match proprietary resources with the quantum of concurrent deals we can manage without compromising our

established reputation for implementation speed. The focus on assuming as many project responsibilities as we can competently address with speed represents a constant in our business, protecting our brand. We believe that the ability to walk away from a deal because we would not be able to do justice in terms of corresponding time allocation is reputation-protecting that strengthens the word of mouth about our commitment to customer interest.

Larger wallet share

One of the critical drivers of success in the on-fund advisory business is trust. When a customer believes that an advisory partner like Prime has provided superior engagement value, there is always the possibility of the customer selecting to work with Prime across a wider range of interventions. In view of this, the objective at Prime is to enhance a customer’s wallet share by addressing a wider range of interventions on the one hand and increasing the frequency of interventions on the other. We expect to derive a growing annual proportion of revenues from existing customers,

a feature of our business that will be increasingly manifest across the future.

Revenue renewal

Sustainable success can be derived either from the linear scaling of the business or linear-cum-lateral growth. At Prime, we have selected to leverage the latter approach, convinced that successful businesses continuously renew their revenues, creating new revenue engines without compromising the overall non-fund-based direction of the business model. The Company showcased this commitment when it entered the wealth management advisory business effective from 1 April 2018. The Company’s objective would be to derive a third of its revenues from businesses that did not exist within the Company three years ago, broad-basing its opportunity-orientation and risk profile.

Payout clarity

At Prime, we believe that it is not only important to report a healthy growth in the bottomline as the principal means of rewarding shareholders. It is imperative to announce


an institutionalised dividend payout policy whereby a pre-determined proportion of profits is paid out to shareholders, deepening the profit sharing commitment (policy to be enunciated and passed by the Board of Directors). Besides, we expect to reward our shareholders through timely buybacks when we believe that such an initiative will enhance shareholder value.

Financialisation

At Prime, we believe that as India financialises (movement from physical assets to financial assets), there will be a growing room to intermediate between financial instrument creators and investors. Following a wider appetite for mutual funds, we see this as the next big opportunity in a country where the needle has begun to shift from investment in traditional asset classes (gold and real estate) towards financial assets. In line with this movement, the Company intends to create distribution networks, market a wide range of products fitting customer needs and generating fee income.

Challenge-driven

At Prime, we are focused on addressing complex challenges faced by corporate customers. This focus makes it possible for the Company to graduate to a niche within a niche marked by relatively low competition and the ability to generate fees commensurate with the Company’s competence and delivered solution.

Two-way relevance

Following the acquisition of the wealth advisory business effective from 1 April 2018, the Company has widened its engagement ambit – from mobilisers of capital for corporates to deployers (across high net worth clients). This two-way relevance has enhanced the Company’s flexibility and relevance in the face of emerging opportunities.

People-lightness

In Prime’s people-light business (employees 17 as on 31 March 2018) the core solution is in-sourced while the peripheral supports are selectively outsourced to domain experts in the areas of taxation etc. The result

is that Prime reported a per person productivity (measured through pre-tax profit divided by number employees as at year-end) of H0.99 crore in 2015-16 that increased to H1.01 crore in 2017-18. Prime enjoys possibly one of the lowest expense ratios within its niche (15.33%, 2017-18) translating into high margins and business sustainability.

ESOPs

In a business that is driven by intellectual capital, the principal asset of the Company lies in our people. Our sustainable success is therefore derived from our ability to retain our people. To strengthen retention on the one hand and strengthen attraction/accretion, the Company proposes to introduce an Employee Stock Option Scheme where employees become owners. We believe that the introduction of ESOPs will also strengthen our overall remuneration package where a combination of direct and indirect remuneration will reduce outflows from the Profit & Loss Account.


Weak bank Balance Sheets

Poor capacity to disburse

credit

Growing opportunity for

NBFCs to assist stressed

companies

Prime’s non-fund based approach providing a single-stop restructuring solution

Win-win solution for restructured

company and lending banks

Robust fee income of the

wealth advisory business

Treasury income

Prime’s knowledge

capital

Solutions innovation

Strategic execution

Lower than sectoral costs as % of revenues

Cash-accretive business sustainability

PRIME’S BUSINESS MODEL GRAPHICALLY EXPLAINED

+ +

+

+

+

+

+ + +

Wealth advisory services (from

2018-19)

Mergers & Acquisitions

advisory services

Capital mobilisation

Prime: Corporate

restructuring


COMPLETED / ONGOING TRANSACTIONS

EQUITY FUND RAISING – ADVISORY & PLACEMENT SERVICES

DEBT / CAPITAL RESTRUCTURING

Branded Retail Fashion Co

H380MMSecondary Placement

Petrochemicals Conglomerate

H66Bn

Agri Products Co

H1.35BnQIP Placement

Steel Products Manufacturer

H440MMEquity Buy-Back

Cables Manufacturer

H~18Bn

Building Materials Manufacturer

H~200MMPreferential Allotment


DEBT FUND RAISING – ADVISORY & STRUCTURING SERVICES

M&A, CORPORATE, STRATEGIC ADVISORY

Leading Housing Finance Co

H28BnRefinancing &

Fresh Capital Raise

Technology Company

Strategic Sale Advisory

Financial Services Major

H15Bn Structured Debt

Healthcare/FMCG Company

Stake Sale Advisory


B U S I N E S S O P P O R T U N I T Y # 1

INDIA READY FOR A STRUCTURAL SHIFT IN FINANCIAL ASSET

INVESTMENTS

A t Prime, we believe that our extension into the wealth

advisory business comes at a relevant point in the history of the country: a shift from the preferred ownership of physical assets to the ownership of financial assets.

Conventionally, Indian households invested about 60% of their savings in physical assets (gold and real estate). Even when it came to financial assets, the preference was always skewed in favour of safe instruments; insurance accounted for 18% of India’s financial investments as against

a mere 6% for shares and debentures. As an extension of this reality, India’s retail investors constituted only approximately 13% of stock ownership in India; demat accounts were less than 10% of the number of banking accounts.

The result is that India’s market capitalisation-to-GDP ratio for India was approximately 82% until a couple of years ago compared to 140% in US, 89% for Korea and 129% for Malaysia. This under-representation of financial assets is visible in other spaces as well: the corporate bonds

outstanding-to-GDP for India was approximately 13% compared to 21% for China, 28% for Hong Kong, 44% for Malaysia, 32% for Singapore and 75% for South Korea.

Until a couple of years ago, Indian mutual funds managed US$270bn in AUM (+US$90bn in equities) with a penetration considered among the lowest in the world at 12% of GDP as against 55% for the global average. India’s equity AUM/GDP ratio at 4% compared weakly with 29% for the world; India’s debt AUM/ GDP ratio at 8% compared with 21% for the world. India’s mutual

Financialisation of India’s savings (in H billion)

Year Bank deposits

Non-banking deposits

Life insurance funds

Provident & pension funds

Shares & debentures

2012-13 5,751 279 1,799 1,565 170

2013-14 6,393 228 2,044 1,778 189

2014-15 6,027 335 2,992 1,887 198

2015-16 6,220 366 2,660 2,768 413

2016-17 10,957 341 4,406 2,960 1,825


fund folios were around a seventh of the number of life insurance policies in India and one-eighth of the number of savings accounts.

However, India’s response to financial assets is transforming with speed. Following demonetisation, the needle has begun to move in a different direction. Until as recently as 2012-13, the annual allocation to financial savings was less than half than the allocation to physical savings. Thereafter, the plateauing of bullion and realty markets have transformed the scenario: during

2015-16, financial savings were marginally higher than physical savings; in the subsequent year, the quantum of financial savings was higher than the allocation to physical savings, indicating an unmistakable direction in India’s savings allocation trend.

The allocation of India’s savings to bank deposits increased at a CAGR of 17.5% between 2012-13 and 2016-17 to reach H10,957 billion in 2017. Meanwhile, investments in shares & debentures increased at a CAGR of 81% to reach H1,825 billion in 2016-17, the sharpest

growth across competing allocation avenues by a long margin even as it accounted for the smallest share of India’s savings (except for non-banking deposits which were lower).

Correspondingly, there has been a significant transformation in the allocation of savings towards mutual funds. The quantum of increase in mutual fund investments in the single year of 2017-18 was almost equivalent to the entire quantum mobilised in 2008-09.

The AUM of the Indian mutual funds segment

H3,200Average SIP size in March 2017

H3,375Average SIP size in March 2018

H43,21CrSIP Contribution

in FY2017

H67,190CrSIP Contribution

in FY2018

H5.05tnAUM as on

31st March 2008

H23.26tnAUM as on

30th April 2018


Years Investments

2009-10 6,139

2010-11 5,922

2011-12 5,872

2012-13 7,014

2013-14 8,252

India’s household investments allocation

Year Financial savings Physical savings

2012-13 7,171 14,650

2013-14 11,900 14,164

2014-15 12,826 15,908

2015-16 15,142 14,951

2016-17 18,204 12,500

Years Investments

2014-15 10,827

2015-16 12,328

2016-17 17,546

2017-18 23,000

Mutual Fund Schemes: Assets under Management (in H billion)

has grown from H5.05 trillion as on 31st March 2008 to H23.26 trillion as on 30th April 2018, more than a-four-and-half-fold increase in a span of a decade. The segment’s AUM crossed the milestone of H10 lakh crore for the first time in May 2014 and within three years, the AUM size crossed H20 lakh crore in August 2017. The total number of folios as of April 2018 stood at 7.22 crore, while the number of folios under equity, ELSS and balanced schemes, wherein the maximum investment is from the retail segment, crossing

the 6-crore landmark to stand at 6.03 crore.

SIP contribution rose to H67,190 crore during FY2017-18 from H43,921 crore in FY2016-17, registering a 53% growth. Indian mutual funds have currently ~2.11 crore SIP accounts through which investors regularly invest in mutual fund schemes. On an average, the mutual fund industry added ~9.70 lakh SIP accounts each month during FY2017-18 (vis-à-vis an average of 6.27 lakh SIP accounts each month during FY2016-17). The average SIP size stood at ~H3,375 in March 2018, up from

H3,200 in March 2017. (Source: AMFI)

At Prime, we believe that this reality provides the Company with a substantial opportunity to grow its presence in the wealth advisory space, making it possible to address a rapidly widening investor appetite, distribute financial products, generate intermediation fees and build the Balance Sheet by not deploying net worth.


B U S I N E S S O P P O R T U N I T Y # 2

GLOBAL UNPREDICTABILITY AND PRIME SECURITIES

T he incidence of non-performing assets among Indian banks

is increasing.

An increasing number of banks is applying stringent filters in recognising bad loans.

There is a regulatory openness in encouraging players to step forward and acknowledge bad loans on their books.

The number of businesses needing restructuring is large.

The competence related to corporate risk identification and analysis is still largely under-developed in India.

There is a greater evidence of manufacturing and marketing knowledge over financial within companies.

Most companies need ongoing course correction as opposed to one-time restructuring.

The incidence of innovation-driven

restructuring consultancies is low in India.

This makes the uncertainty-focused business model of Prime Securities increasingly relevant.

This model is likely to become increasingly relevant on account of an increase in disruptive technologies and developments the world over.

THE WORLD IS PASSING THROUGH AN UNPRECEDENTED INCREASE IN

DEVELOPMENTS THAT ARE INCREASING ECONOMIC VOLATILITY

Trade wars

The US implemented of 25% tariffs on US$ 34 billion worth of imports from China from July 2018. The US released a list of US$ 200 billion

worth of Chinese goods likely to attract 10% tariffs following review. Beijing hit the US with retaliatory tariffs on 545 products. This is arguably the biggest tariff application by the US since the Smoot-Hawley tariffs that deepened the Great Depression,

shrinking world trade by 66% between 1929 and 1934. In June 2018, the EU put US$ 3.2 billion tariff on US goods in retaliation for the Trump administration’s steel and aluminum tariffs, targeting products like bourbon, orange juice and motor cycles.


terms, China’s debt has increased from US$6 trillion to US$28 trillion. China’s credit growth is on a dangerous trajectory, with increasing risks of a disruptive adjustment and/or a marked growth slowdown. IMF projects a debt-to-GDP ratio of 300% by 2022. This could moderate Chinese economic growth.

Green energy

By 2022, global renewables electricity generation is expected to grow by over one-third to over 8,000 terawatts per hour, equal to the total power consumption of China, India and Germany combined. As a result, the share of renewables in power generation could reach 30% in 2022, up from 24% in 2016. In the next five years, growth in renewable generation could be twice as large as that of gas and coal combined. This could affect large funding of thermal energy power plants, affecting shareholders and debt providers.

Cryptocurrency

Bitcoins could affect faith in established global currencies and banking networks. Financial transactions could start getting decentralised, with no recourse to the traditional US Dollar. The dynamics of international trade can change.

Brexit

The advantage for the UK is that it would prohibit the free flow of people from the EU. Brexit could slow the growth of UK to 2.4% in 2018, 1.9% in 2019, and 1.6% in 2020. Brexit is a vote against globalisation. It takes the UK off the main stage of the financial world.

China’s economic slowdown

China’s debt to GDP ratio has mushroomed from 140% during the 2007-08 financial crisis to 260% by end of 2016. In absolute

Electric vehicles

Global electric vehicle sales are poised to climb from 1.2 million in 2017 to 1.6 million in 2018 and an estimated 2 million in 2019; almost every sixth car sold in the world could be electric by 2025 (16.5 million). Since each electric car comprises a lower number of automotive components, this could affect the growth of the auto ancillary sector worldwide and investments in special steel manufacturers.

Artificial intelligence

The artificial intelligence market is expected to reach US$ 190.61 billion by 2025 from US$ 21.46 billion in 2018, a CAGR of 36.62% during the forecast period. Robots and AI could replace jobs. Tasks which are monotonous could be easily automated, making certain roles obsolete, affecting employment across countries.


3D printing

The increasing use of 3D printing to manufacture a number of products means that the labour arbitrage advantage could become a thing of the past. Manufacturers could move closer to raw material access and consumption markets instead, disturbing longstanding economic realities.

Platform-based aggregation

The increased use of platform-based aggregation (Uber, Airbnb and others) is replacing conventional business, threatening investments in the latter. Increasing dis-intermediation is threatening the global order through lower costs, enhanced transaction ease and a movement away from businesses once considered safe.

CRISPR

CRISPR is a new tool for genetic research that

allows scientists to locate specific segments of DNA and easily replace or delete them. This could cause a huge disruption in the way healthcare is delivered by curing disease at the genetic level, disrupting existing medical treatments.

Advanced automation and robotics

Due to better sensors, artificial intelligence and Siri-like voice communications, robots could work with humans in new and productive ways, disrupting routine processes.

BIoT

The combination of IoT and blockchain — BIoT— ushers a host of new services. BIoT can be used to track shipments of products. This could disrupt conventional processes.

Cloud computing

The personalisation of cloud computing and

advanced cloud services will be increasingly embraced by business of all sizes, as this represents a major shift in how organisations obtain and maintain software, hardware, and computing capacity. Companies using cloud could cut costs in IT, human resources, and sales management functions.

Augmented Reality

Augmented Reality (AR) can simulate real-world scenarios. That allows orientations or training to take place in a safe environment versus a real-world environment that can be more dangerous. This could disrupt traditional services.

Autonomous driving

Autonomous driving will be facilitated by the data-processing capabilities of machine learning, but its disruption capabilities could be widespread. With autonomous vehicles, transportation could be largely converted to ride-sharing, moderating the use of vehicles.


DIRECTORS

Mr. Dubhashi holds a BE in Electrical Engineering and a post graduate diploma in Management from XLRI, Jamshedpur. He held senior executive positions in SICOM, Mahindra Group and Venky Group. He has in-depth knowledge of various industries such as, engineering, cement, chemicals and specialties, software and biotechnology. He has consulted for Indian and foreign companies. He was also nominated on the Boards of Directors of various companies including as a nominee director of financial institutions. He has attended several courses conducted by IIM Ahmedabad, IEEE, NCST, ASCI, among others, in advanced finance, management and technology areas.

Mr. Jayakumar joined Prime Securities in 1993. He holds a B.Tech in Mechanical Engineering from IIT Delhi (1978-83) and an MBA from IIM Ahmedabad (1983-85). Prior to joining Prime, he was head of the Investment Banking Group at Citibank, having previously spent several years in money markets and securities trading. He is a recognised face on various business TV channels and for equity research, wealth management, private equity, wealth restructuring, Indian economy and stock markets.

Mr. Pradip DubhashiChairman & Independent Director, Prime Securities Limited and Primesec Investments Limited

Mr. N. JayakumarManaging Director and Group CEO, Prime Securities Limited


Mr. Dharker holds degrees in Mathematics and Engineering from London University and occupied a position on the academic staff of the University of Glasgow. He also served as a consultant in a Mumbai architectural firm. He has been editor of the some of India’s best known publications, such as The Illustrated Weekly of India, The Independent and Mid-Day. He has been a columnist for many of India’s leading newspapers such as The Times of India, The Economic Times, The Hindu and DNA. He has also been a columnist for Gulf News and Khaleej Times. He has also written for The Independent (London), The Scotsman (Edinburgh), The Glasgow Herald, Foreign Policy and other publications.

Ms. Alpana graduated from IIM Ahmedabad in 1985 and has a degree in Economics from St. Stephens College, Delhi University. Ms. Parida serves as the President of DY Works, India’s oldest and largest branding firm headquartered in Mumbai with offices in Delhi and Singapore. Previously, she served as head of marketing at Tanishq. She has more than two decades of experience in retail and marketing communications in the US and in India. She conducts branding workshops for large corporates. She has been an Independent Non-Executive Director at Cosmo Films Limited since February 2014.

Mr. Anil DharkerIndependent Director, Prime Securities Limited and Primesec Investments Limited

Ms. Alpana ParidaIndependent Director, Prime Securities Limited, Primesec Investments Limited and Prime Research and Advisory Limited


Mr. Sharma graduated from IIT Delhi as a Chemical Engineer and received his post graduate diploma in management, PGDM from IIM Ahmedabad. He has a wide experience across multiple sectors including industrial and specialty chemicals, FMCG and financial services. He was based in Japan for nine years where he worked for Shinsei Bank. He has specialised in the transformation of customer- facing business processes and post- transaction operations by leveraging the use of IT.

Mr. Suri started his career with Citibank in Mumbai and has over two decades of banking experience in banking. He was focused on debt financing during his tenure with top banks based in Mumbai, London, Riyadh and Bahrain. Vineet has worked on a variety of transactions encompassing corporate, project and structured finance for clients spread across India, Central and Eastern Europe, the Middle East and Africa. Vineet is a chartered accountant from the Institute of Chartered Accountants of India.

Mr. S. R. SharmaNon-Executive Director, Prime Securities Limited and Managing Director, Primesec Investments Limited.

Mr. Vineet SuriExecutive Director, Director & Head of Corporate Finance, Prime Securities Limited


He has more than 21 years of experience in Banking, Asset Management and Capital Markets with last 14 years of experience in the Asset Management industry in India.

Prior to Prime, he was working with India Bulls as the Group Executive Head & CEO-Asset Management and other fee income businesses. He was associated with Peerless Asset Management as MD & CEO for more than 6 years, wherein he led the initiative to set up a new AMC and made it one of the fastest growing new AMCs in India.

He worked with ICICI Prudential Asset Management Company from 2002- 2007 as a Business Head and was part of the senior management team that made it the largest and most successful AMC at that time. Prior to joining the AMC industry, Mr. Akshay Gupta was a banker having worked in ABN AMRO Bank and HSBC in their capital market and asset businesses. He has also written and published articles on asset management and wealth management.

Mr. Akshay GuptaCEO & CIO, Prime Research and Advisory Limited


An effective and committed leader with spotless integrity and passion with a deep understanding of financial products for more than 28 years’ experience with global financial firms in fixed income, treasury management & corporate finance. Mr. Pandey has dealt in transactional volumes that have been large and difficult to get in. His focus is on the institutional sector and has been an aid to industry. He has also helped in setting up different businesses in the financial sector. He has worked with a lot of integrity in firms like Religare Finvest, JM Financial, JM Morgan Stanley, Mata Securities and Ashok Leyland Finance Limited

Located in Mumbai, Ms. Deodhar is Director Development of LMI India [Leadership Management International India], the Indian arm of LMI Inc USA, one of the largest professional development companies in the world. She is also the founder of Impression & Beyond, a Leadership and Image Consultancy. Kadambari holds a Master’s degree in Monetary Economics from the University of Bombay. She has had a diversified career spanning over 30 years, starting with ICICI Limited in the Market Research Department while working closely with the Project Appraisal team.

When she joined JM Financial in 1985 she was introduced to the Indian Money and Debt Markets. In 1992 she set up the corporate desk at Nucleus Securities and subsequently the NSE Desk at Ashok Leyland Investments in 1994 where she became the Head of Operations. In 1998, she moved to Mata Securities as a Director and started the corporate desk while continuing to grow the business till 2011.

Mr. Puneet PandeyManaging Director, Prime Research and Advisory Limited

Ms. Kadambari DeodharIndependent DirectorPrime Research and Advisory Limited


MANAGEMENT TEAM

Mr. Nikhil ShahChief Financial Officer

Mr. Shah has been associated with Prime Securities Limited since June 2003. He has a vast experience of more than 20 years in the field of accountancy. He is responsible for overseeing the entire accounting as well as taxation operations of Prime

Group. Mr. Shah is a qualified Chartered Accountant affiliated with the Institute of Chartered Accountants of India. Prior to his association with Prime, he was associated with Microtex India Limited as Manager - Accounts.

Mr. Ajay ShahVP Legal / Company Secretary

Mr. Shah joined Prime Securities Limited in July 2001 as a Company Secretary and Compliance Officer and is presently the Vice President - Legal & Company Secretary. He has hands on experience of more than 15 years in the streams of legal, corporate secretarial compliance. In addition to compliances under corporate laws with a specific impetus on secretarial compliance and corporate governance, he is also responsible for

compliances with rules and regulations applicable to stock brokers, portfolio managers and depository activities as well as for drafting legal agreements and contracts, reporting to the management, statutory bodies and stakeholders of Prime Group. He is a qualified Company Secretary affiliated to the Institute of Company Secretaries of India. Prior to joining Prime, he was associated with Asian Star Company Limited as Company Secretary.

Mr. Apurva DoshiVP Corporate Finance

Mr. Doshi joined Prime Securities in 2007. He has over 12 years of experience, principally as an investment banker. His skill lies in financial and business analysis, negotiations, valuation, business planning and financial advisory. Prior to joining Prime Securities, Apurva worked with CRISIL Research & Information Services Limited, an S&P company, as a research analyst for around two years, tracking

the automobile sector. He began his career at Stratcap Securities, as an equity research analyst and tracked the automobile and cement sectors. He has a post graduate diploma in Business Administration (PGDBA) in Finance from Chetana’s Institute of Management & Research and Masters in Commerce (M. Com.) from Mumbai University.


Mr. Rachit GoelVP Corporate Finance

Possesses more than 10 years of experience as an Investment Banker. Joined Prime Securities in June 2016. Prior to joining Prime, Rachit worked with HSBC as an Associate Director across various sectors as part of their investment banking and capital

markets team. Possesses experience in deal origination, financial modeling, due diligence, funding and strategic acquisition/exit for large corporates. He is an MBA (Finance) and did his Bachelors in Commerce (Hons.) from University of Delhi.

Mr. Nischay SarafVP Corporate Finance

A Chartered Accountant with an experience of over 12 years. Has worked with global professional firms (PwC and KPMG) in the audit and consulting services, in the finance verticals of multinational companies

(Wipro and HP) and with a Vietnamese conglomerate (Masan Group). He has experience in operational financials including accounting & reporting and strategic finance including fund raising and corporate restructuring.


CORPORATE INFORMATION

REGISTERED OFFICE

1109/1110, Maker Chambers V, Nariman Point, Mumbai 400021 Tel: +91-22-61842525 Fax: +91-22-24970777 E-mail: [email protected]

CORPORATE IDENTITY NUMBER

L67120MH1982PLC026724

ISIN/LISTING OF EQUITY SHARES

ISIN: INE032B01021

Scrip Code: NSE (PRIMESECU) BSE (500337)

BANKERS

IndusInd Bank Limited ICICI Bank Limited HDFC Bank LimitedKotak Mahindra Bank Limited Bank of India

STATUTORY AUDITORS

Gandhi & Associate LLP Chartered Accountants

INTERNAL AUDITORS

K.V.S. & Company Chartered Accountants

REGISTRAR & SHARE TRANSFER AGENT

Link Intime India Private LimitedC-101, 247 Park, L.B.S. Marg, Vikhroli (West), Mumbai, 400083 Tel: +91-22-49186270, Fax: +91-22-49186060 E-mail: [email protected] Website: www.linkintime.co.in

35TH ANNUAL GENERAL MEETING

Monday, September 24, 2018 @ 2.00 p.m. at Victoria Memorial School for the Blind, Tardeo Road, Opp. Film Centre, Near Bharat Petroleum Petrol Pump, Mumbai 400034


CONTENTSNotice .......................................................................................47

Director’s Report....................................................................74

Management Discussion & Analysis Report .................................................................. 82

Corporate Governance Report ......................................... 85

Auditor’s Report ...................................................................125

Balance Sheet .......................................................................132

Profit & Loss Account .........................................................133

Cash Flow Statement .........................................................135

Notes on Financial Statement ..........................................137

Consolidated Financial Statements ................................ 177

Particulars of Subsidiaries .................................................228


NOTICE OF ANNUAL GENERAL MEETINGNOTICE IS HEREBY GIVEN THAT the 35th Annual General Meeting of the Members of Prime Securities Limited will be held on Monday, September 24, 2018 at 2.00 p.m. at Victoria Memorial School for the Blind, Tardeo Road, Opp. Film Centre, Near Hindustan Petroleum Petrol Pump, Mumbai 400034 to transact the following business:

ORDINARY BUSINESS1. Adoption of Audited Financial Statements: To consider and adopt:

a) The Audited Standalone Financial Statements of the Company for the Financial Year ended March 31, 2018 and the Reports of the Board of Directors and Independent Auditors thereon; and

b) The Audited Consolidated Financial Statements of the Company for the Financial Year ended March 31, 2018 and the Reports of the Independent Auditors thereon;

2. Re-appointment of Director: To appoint a Director in place of Mr. S. R. Sharma (DIN: 03096740), who retires by rotation and,

being eligible, offers himself for re-appointment.

SPECIAL BUSINESS3. Revision in Remuneration to Mr. N. Jayakumar, Managing Director and Group CEO: Toconsiderand,ifthoughtfit,topass,withorwithoutmodification(s),thefollowingresolutionas

a Special Resolution:

“RESOLVED THAT pursuant to the provisions of Sections 196, 197, 198, 203 and any other applicable provision(s) read with Schedule V of the Companies Act, 2013, the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (including any statutory modification(s),amendment(s) or re-enactment thereof for the time being in force), the Articles of Association of the Company, the recommendation of the Nomination and Remuneration Committee and subject to such other approvals as may be necessary, the approval of the Members be and is hereby accorded to the revision in the Payment of the Remuneration to Mr. N. Jayakumar (DIN: 00046048) w.e.f. April 1, 2018, for the remainder of his term as Managing Director and Group CEO of the Company, on the terms and conditions set out in the Explanatory Statement annexed to the Notice convening this Meeting, including the remuneration to be paid in the event of loss or inadequacy ofprofitsinanyfinancialyearduringtheremainderofhisterm,withlibertyandpowertotheBoardof Directors (hereinafter referred to as the “Board”, which term shall include the Nomination and Remuneration Committee of the Board), in the exercise of its discretion, to alter and vary the terms and conditions of the said appointment and payment of remuneration in such manner as may be agreed to between the Board of Directors and Mr. N. Jayakumar.

RESOLVED FURTHER THATwhere inanyfinancialyearduringthecontinuanceofhistenureasa Managing Director, the Company is required to obtain the approval of the Central Government under the provisions of the Companies Act, 2013 for the payment of remuneration, the maximum remuneration permissible for payment to Mr. N. Jayakumar under the provisions of Sections 196


and 197 of the Companies Act, 2013 read with Schedule V to the said Act or the maximum limit as maybenotifiedfromtimetotime,bepaidtillthereceiptoftheapprovaloftheCentralGovernment.

RESOLVED FURTHER THAT on receipt of the approval of the Central Government, the amount of remuneration on the terms as approved by the Central Government, as reduced by such amount of the Remuneration already paid for the period for which the Central Government’s approval is sought, be paid to Mr. N. Jayakumar, Managing Director and Group CEO, in lump sum and that after the date of the approval, Mr. N. Jayakumar be paid the remuneration as per the terms and conditions approved by the Central Government.

RESOLVED FURTHER THAT the Board be and is hereby authorized to take all such steps as may be necessary, proper and expedient to give effect to this Resolution.

4. Appointment of Mr. Vineet Suri as Executive Director and Payment of Remuneration: Toconsiderand,ifthoughtfit,topass,withorwithoutmodification(s),thefollowingresolutionas


“RESOLVED THAT pursuant to the provisions of Sections 196, 197, 198, 203 and any other applicable provision(s) read with Schedule V of the Companies Act, 2013, the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 (including any statutory modification(s),amendment(s) or re-enactment thereof for the time being in force), the Articles of Association of the Company, the recommendation of the Nomination and Remuneration Committee and subject to such other approvals as may be necessary, the approval of the Members be and is hereby accorded to the Appointment and Payment of Remuneration to Mr. Vineet Suri (DIN: 07995566) as Executive Director for a period of 5 (Five) years commencing from May 29, 2018 to May 28, 2023, on the terms and conditions set out in the Explanatory Statement annexed to the Notice convening thisMeeting, includingtheremunerationtobepaidintheeventof lossorinadequacyofprofitsinanyfinancial yearduringhis termasExecutiveDirector,with libertyandpower to theBoardof Directors (hereinafter referred to as the “Board”, which term shall include the Nomination and Remuneration Committee of the Board), in the exercise of its discretion, to alter and vary the terms and conditions of the said appointment and payment of remuneration in such manner as may be agreed to between the Board of Directors and Mr. Vineet Suri.

RESOLVED FURTHER THATwhere inanyfinancialyearduringthecontinuanceofhistenureasa Executive Director, the Company is required to obtain the approval of the Central Government under the provisions of the Companies Act, 2013 for the payment of remuneration, the maximum remuneration permissible for payment to Mr. Vineet Suri under the provisions of Sections 196 and 197 of the Companies Act, 2013 read with Schedule V to the said Act or the maximum limit as may benotifiedfromtimetotime,bepaidtillthereceiptoftheapprovaloftheCentralGovernment.

RESOLVED FURTHER THAT on receipt of the approval of the Central Government, the amount of remuneration on the terms as approved by the Central Government, as reduced by such amount of the Remuneration already paid for the period for which the Central Government’s approval is sought, be paid to Mr. Vineet Suri, Executive Director, in lump sum and that after the date of the approval, Mr. Vineet Suri be paid the remuneration as per the terms and conditions approved by the Central Government.

RESOLVED FURTHER THAT the Board be and is hereby authorized to take all such steps as may be necessary, proper and expedient to give effect to this Resolution.



5. Alteration and Adoption of Memorandum and Articles of Association: a) Approval for alteration of the Object Clause and alignment of Memorandum of Association

of the Company with the provisions of the Companies Act, 2013 by adoption of Table A of Schedule I of the Companies Act, 2013

Toconsiderand,ifthoughtfit,topass,withorwithoutmodification(s),thefollowingresolutionas a Special Resolution:

“RESOLVED THATpursuanttotheprovisionsofSection13andanyotherapplicableprovisionsoftheCompaniesAct,2013(includinganystatutorymodification(s),amendment(s)orre-enactmentthereofforthetimebeinginforce),theRulesmadethereunderandtheapprovaloftheRegistrarofCompanies,theconsentoftheMembersbeandisherebyaccordedtoaltertheObjectClauseoftheMemorandumofAssociationoftheCompanyandtoadoptTableAofScheduleIoftheCompaniesAct,2013.

RESOLVED FURTHER THAT theMembersbeanddoherebyauthorizetheBoardtoacceptanyaddition/alteration in theproposeddraftofMemorandumofAssociationmentionedabove,asmayberequiredbytheconcernedauthoritiesandasagreedbytheBoard.

RESOLVED FURTHER THAT theMembersbeanddoherebyauthorisetheBoardtotakesuchstepsasmaybenecessaryforobtainingapprovals,statutory,contractualorotherwise, inrelationtotheaboveandtosettleallmattersarisingoutofandincidentaltheretoandsignandexecutealldeeds,applications,documentsandwritingsthatmayberequired,onbehalfoftheCompanyandalsotodelegatealloranyoftheabovepowerstooneormoreDirectoroftheCompanyandgenerallytodoallacts,deedsandthingsthatmaybenecessary,proper,expedientorincidentalforthepurposeofgivingeffecttotheaforesaidResolution.

RESOLVED FURTHER THAT theMembersbeanddoherebyauthorizeanyDirectorof theCompanytosignandfileanyforms,e-forms,returns,documentswhichmayberequiredtobefiledwiththeRegistrarofCompanies,MinistryofCorporateAffairsoranyotherconcernedauthorityinthisregard.

RESOLVED FURTHER THAT acertifiedtruecopyoftheresolutioncertifiedbyaDirectoroftheCompanybeprovidedtoanyregulatoryauthorityoranystakeholderinthemannerasmaybedeemedappropriatebytheBoard.”

b) Approval for adoption of Table F of Schedule I of the Companies Act, 2013 for alignment of Articles of Association of the Company with the provisions of the Companies Act, 2013

Toconsiderand,ifthoughtfit,topass,withorwithoutmodification(s),thefollowingresolutionas a Special Resolution:

“RESOLVED THATpursuanttotheprovisionsofSection14andotherapplicableprovisionsof the Companies Act, 2013 readwith Companies (Incorporation) Rules, 2014 (includinganystatutorymodification(s),enactment(s)orre-enactment(s)thereofforthetimebeinginforce),theconsentoftheMembersbeandisherebyaccordedtoalterandamendtheexistingsetofArticlesofAssociationtoremovetheredundantclausesofCompaniesAct,1956andtoalignitwithCompaniesAct,2013&TableFofScheduleIofCompaniesAct,2013,ininclusionoftheexistingnon-redundantclausesofArticlesofAssociationoftheCompany.

RESOLVED FURTHER THATanyoftheDirectorsofthecompanybeandisherebyjointly/severallyauthorizedtotakeallsuchstepsandactionsforthepurposeofmakingallsuch


filings(includinge-filingswithROC)andregistrationsasmayberequiredinrelationtotheaforesaidamendmenttotheArticlesofAssociationandfurthertodoallsuchactsanddeeds,mattersandthingsasmaybedeemednecessarytogiveeffecttothisresolution.

RESOLVED FURTHER THATanyoftheDirectorsoftheCompany,beandareherebyseverallyauthorisedtoissue/providecertifiedtruecopiesoftheseresolutions.”

6. Implementation of Employee Stock Option Scheme 2018: Toconsiderand,ifthoughtfit,topass,withorwithoutmodification(s),thefollowingresolutionas


“RESOLVED THATpursuanttotheprovisionsofSection62andanyotherapplicableprovisionsoftheCompaniesAct,2013readwiththeRulesframedthereunder,theSecuritiesandExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBIListing Regulations”), the Securities and Exchange Board of India (Share Based EmployeeBenefits)Regulations, 2014 (“SEBISBEBRegulations”) (includingany statutorymodification(s),amendment(s) or re-enactment thereof for the time being in force) and in accordance withcirculars /guidelines issuedbySecuritiesandExchangeBoardof India (“SEBI”), theArticlesofAssociation of the Company and other applicable regulations, rules and circulars / guidelinesin force, from time to timeandsubject tosuchotherapprovals,permissionsandsanctionsasmaybenecessaryfromtimetotimeandsubjecttosuchconditionsandmodificationsasmaybeprescribedor imposedwhilegrantingsuchapprovals,permissionsandsanctions, theapprovalof theMembersbeand isherebyaccordedtotheBoardofDirectors(hereinafterreferredtoasthe “Board”,which term shall be deemed to include anyCommittee, including theNominationandRemunerationCommittee,whichtheBoardhasconstitutedtoexerciseitspowers,includingthe powers, conferred by this resolution) to introduce and implement the “Employees StockOptionScheme2018”(hereinafterreferredtoasthe“ESOS2018”)asdetailedintheexplanatorystatementto theNoticeconveningthisMeetingandtocreate,grant,offer, issueandallot fromtimetotimeupto45,00,000(FortyFiveLacs)Options,toortothebenefitofsuchperson(s)whoarepermanentemployeesoftheCompany,whetherworkinginIndiaoroutsideIndia,and/ortotheDirectorsoftheCompany,whetherwhole-timeornotbutexcludingIndependentDirector(s)andtosuchotherpersonsasmaybedecidedbytheBoardand/orpermittedunderSEBISBEBRegulations(hereinafterreferredtoas“EligibleEmployees”)butdoesnotincludeanemployeewhoisapromoterorapersonbelongingtothepromotergrouporadirector(s)whoeitherhimselforthroughhisrelativeorthroughanybodycorporate,directlyorindirectly,holdsmorethan10%oftheoutstandingequitysharesoftheCompany,eachOptiongivingrighttopurchaseorsubscribeOneEquityShareoffacevalueofH5/-eachoftheCompanyforcashandatsuchpriceorprices,andonsuchtermsandconditions,asmaybedeterminedbytheBoardinaccordancewiththeprovisionsofESOS2018andinduecompliancewiththeSBEBRegulationsandotherapplicablelaws,rulesandregulations.

RESOLVED FURTHER THAT the Board and any Committee formed for this purpose be and isherebyauthorisedtoissueandallotEquitySharesuponexerciseofOptionsfromtimetotimeinaccordancewiththeESOS2018andotherapplicablelawsinforceandsuchEquitysharesshallrankparipassuinallrespectswiththethenexistingEquitySharesoftheCompany.

RESOLVED FURTHER THAT incaseofanycorporateaction(s)suchasrightsissue,bonusissue,merger, restructuringor suchother similar event, theBoardbeand is herebyauthorized todoallsuchacts,deedsandthingsasmaybenecessaryandwhicharewithintheprovisionsoftheapplicablelaws&regulations,soastoensurethatfairandequitablebenefitsunderESOS2018arepassedontotheEligibleEmployees.


RESOLVED FURTHER THAT incasetheEquitySharesoftheCompanyareeithersub-dividedorconsolidated,thenthenumberofsharestobeallottedandthepriceofacquisitionpayablebytheoptionsGranteesundertheschemesshallautomaticallystandaugmentedorreduced,asthecasemaybe, in thesameproportionas thepresent facevalueofH5/-perequitysharebears to therevisedfacevalueoftheequitysharesoftheCompanyaftersuchsub-divisionorconsolidation,withoutaffectinganyotherrightsorobligationsofthesaidallottees.

RESOLVED FURTHER THAT theBoardbeand isherebyauthorisedtodevise, formulate,evolve,decideuponandbring intoeffectESOS2018asper thetermsapproved in thisresolutionreadwiththeexplanatorystatementannexedtotheNoticeconveningthisMeetingandatanytimetomodify,alteroramendthesaidtermsorsuspend,withdraworterminateESOS2018,subjecttocompliancewiththeSEBISBEBRegulationsandotherapplicablelaws,rulesandregulations,asmaybeprevailingatthattime.

RESOLVED FURTHER THAT the Company shall conform to the accounting policies prescribedfromtimetotimeundertheSEBISBEBRegulationsandanyotherapplicablelawsandregulationstotheextentrelevantandapplicabletotheESOS2018.

RESOLVED FURTHER THATanyof theDirectorsof theCompanyorCompanySecretaryof theCompanybe and is hereby authorized to takenecessary steps for listingof the EquitySharesallottedundertheESOS2018ontheStockExchanges,wheretheEquitySharesoftheCompanyarelisted,aspertheprovisionsofSEBILODRRegulationsandotherapplicablelawsandregulations.

RESOLVED FURTHER THAT theBoard be and is hereby authorised to do all such acts, deeds,mattersandthingsasitmay,initsabsolutediscretiondeemfit,fortheaforesaidpurposeandalsotosettleany issues,questions,difficultiesordoubts thatmayarise in this regardatanystage,withoutbeingrequiredtoseekanyfurtherconsentorapprovaloftheMembersoftheCompanytotheendandintentthattheMembersshallbedeemedtohavegiventheirapprovaltheretoexpresslybytheauthorityofthisresolutionandfurthertoexecuteallsuchdeeds,documents,writingsandtogivesuchdirectionsand/orinstructionsasmaybenecessary,properorexpedienttogiveeffecttoanymodification,alteration,amendment,suspension,withdrawalorterminationofESOS2018andtotakeallsuchstepsanddoallactsasmaybeincidentalorancillarythereto.”

7. Extension of benefits of Employee Stock Option Scheme 2018 to the EligibleEmployees / Directors of the Subsidiaries:

Toconsiderand,ifthoughtfit,topass,withorwithoutmodification(s),thefollowingresolutionasa Special Resolution:

“RESOLVED THATpursuanttotheprovisionsofSection62andanyotherapplicableprovisionsoftheCompaniesAct,2013readwiththeRulesframedthereunder,theSecuritiesandExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBIListing Regulations”), the Securities and Exchange Board of India (Share Based EmployeeBenefits)Regulations, 2014 (“SEBISBEBRegulations”) (includingany statutorymodification(s),amendment(s) or re-enactment thereof for the time being in force) and in accordance withcirculars /guidelines issuedbySecuritiesandExchangeBoardof India (“SEBI”), theArticlesofAssociation of the Company and other applicable regulations, rules and circulars / guidelinesin force, from time to timeandsubject tosuchotherapprovals,permissionsandsanctionsasmaybenecessaryfromtimetotimeandsubjecttosuchconditionsandmodificationsasmaybeprescribedorimposedwhilegrantingsuchapprovals,permissionsandsanctions,theapprovaloftheMembersbeandisherebyaccordedtotheBoardofDirectors(hereinafterreferredtoasthe


“Board”,which termshall bedeemed to includeanyCommittee, including theNominationandRemunerationCommittee,whichtheBoardhasconstitutedtoexerciseitspowers,includingthepowers,conferredbythisresolution)toextendthebenefitsoftheEmployeesStockOptionScheme2018(“ESOS2018”),referredtointheSpecialResolutionunderItemNo.6oftheNoticeconveningthisMeeting,forthebenefitofsuchperson(s)whoarepermanentemployeesofSubsidiariesoftheCompany,whetherworkinginIndiaoroutsideIndia,and/ortotheDirectorsoftheSubsidiaries,whether whole-time or not but excluding Independent Director(s) of Subsidiaries and to suchotherpersonsasmaybedecidedbytheBoardand/orpermittedunderSEBISBEBRegulations(hereinafterreferredtoas“EligibleEmployeesofSubsidiaries”)butdoesnotincludeanemployeewhoisapromoterorapersonbelongingtothepromotergrouporadirector(s)whoeitherhimselforthroughhisrelativeorthroughanybodycorporate,directlyorindirectly,holdsmorethan10%oftheoutstandingequitysharesoftheCompany,totheintentthatthenumberofOptionsofferedunderESOS2018totheEligibleEmployeesoftheSubsidiariesshallbesubsumedintheaggregatelimitof45,00,000Options,eachOptiongivingrighttopurchaseorsubscribeOneEquityShareoffacevalueofH5/-eachoftheCompanyforcashandatsuchpriceorprices,andonsuchtermsandconditionssetoutintheSpecialResolutionunderItemNo.6oftheNoticeconveningthisMeeting.

RESOLVED FURTHER THAT theBoard be and is hereby authorised to do all such acts, deeds,mattersandthingsasitmay,initsabsolutediscretiondeemfit,fortheaforesaidpurposeandalsotosettleany issues,questions,difficultiesordoubts thatmayarise in this regardatanystage,withoutbeingrequiredtoseekanyfurtherconsentorapprovalofthemembersoftheCompanyto the end and intent that themembers shall be deemed to have given their approval theretoexpresslyby theauthorityof this resolution,and further toexecuteallsuchdeeds,documents,writingsandtogivesuchdirectionsand/orinstructionsasmaybenecessary,properorexpedienttogiveeffecttoanymodification,alteration,amendment,suspension,withdrawalorterminationofESOS2018andtotakeallsuchstepsanddoallactsasmaybeincidentalorancillarythereto.”

8. GrantingofOptionsexceeding1%ofIssuedCapitaltoidentifiedEmployeesunderEmployee Stock Option Scheme 2018:

Toconsiderand,ifthoughtfit,topass,withorwithoutmodification(s),thefollowingresolutionasa Special Resolution:

“RESOLVED THATpursuanttotheprovisionsofSection62andanyotherapplicableprovisionsoftheCompaniesAct,2013readwiththeRulesframedthereunder,theSecuritiesandExchangeBoard of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“SEBIListing Regulations”), the Securities and Exchange Board of India (Share Based EmployeeBenefits)Regulations, 2014 (“SEBISBEBRegulations”) (includingany statutorymodification(s),amendment(s) or re-enactment thereof for the time being in force) and in accordance withcirculars /guidelines issuedbySecuritiesandExchangeBoardof India (“SEBI”), theArticlesofAssociation of the Company and other applicable regulations, rules and circulars / guidelinesin force, from time to timeandsubject tosuchotherapprovals,permissionsandsanctionsasmaybenecessaryfromtimetotimeandsubjecttosuchconditionsandmodificationsasmaybeprescribedor imposedwhilegrantingsuchapprovals,permissionsandsanctions, theapprovalof theMembersbeand isherebyaccordedtotheBoardofDirectors(hereinafterreferredtoasthe “Board”,which term shall be deemed to include anyCommittee, including theNominationandRemunerationCommittee,whichtheBoardhasconstitutedtoexerciseitspowers,includingthepowers,conferredbythisresolution)tocreate,grant,offer,issueandallotfromtimetotimetheOptionsexceeding1%oftheIssuedCapitaltoidentifiedEmployees(includingEmployeesof


Subsidiariesof theCompany)under theEmployeesStockOptionScheme2018 (“ESOS2018”),referredtointheSpecialResolutionunderItemNo.6oftheNoticeconveningthisMeeting,asmaybedecidedbytheBoardand/orpermittedunderSEBISBEBRegulations,totheintentthatthenumberofOptionsofferedunderESOS2018shallbesubsumedintheaggregatelimitof45,00,000Options,eachOptiongivingrighttopurchaseorsubscribeOneEquityShareoffacevalueofH5/-eachoftheCompanyforcashandatsuchpriceorprices,andonsuchtermsandconditionssetoutintheSpecialResolutionunderItemNo.6oftheNoticeconveningthisMeeting.

RESOLVED FURTHER THAT theBoard be and is hereby authorised to do all such acts, deeds,mattersandthingsasitmay,initsabsolutediscretiondeemfit,fortheaforesaidpurposeandalsotosettleany issues,questions,difficultiesordoubts thatmayarise in this regardatanystage,withoutbeingrequiredtoseekanyfurtherconsentorapprovalofthemembersoftheCompanyto the end and intent that themembers shall be deemed to have given their approval theretoexpresslyby theauthorityof this resolution,and further toexecuteallsuchdeeds,documents,writingsandtogivesuchdirectionsand/orinstructionsasmaybenecessary,properorexpedienttogiveeffecttoanymodification,alteration,amendment,suspension,withdrawalorterminationofESOS2018andtotakeallsuchstepsanddoallactsasmaybeincidentalorancillarythereto.”


NOTES:

1. AnExplanatoryStatement,pursuanttoSection102of theCompaniesAct,2013, relatingtotheSpecialBusinesstobetransactedattheAnnualGeneralMeetingformspartofthisNotice.

2. AMEMBER ENTITLEDTOATTENDANDVOTEATTHEMEETING IS ENTITLEDTOAPPOINTAPROXYTOATTENDANDVOTE INSTEADOFHIMSELF/HERSELFANDTHEPROXYNEEDNOTBEAMEMBEROFTHECOMPANY.PursuanttotheprovisionsofSection105oftheCompaniesAct,2013,apersoncanactasaProxyonbehalfofnotmorethan50Membersandholding intheaggregatenotmore than10%of the totalShareCapitalof theCompany.Membersholdingmorethan10%ofthetotalShareCapitaloftheCompanymayappointasinglepersonasProxy,whoshallnotactasaProxyforanyotherMembers.Proxies inordertobeeffective,shouldbedepositedattheRegisteredOfficeoftheCompany,dulycompletedandsigned,notlessthan48hoursbeforethetimeofcommencementof theAnnualGeneralMeeting.ProxiessubmittedonbehalfofLimitedCompanies,Societies,etc.,mustbesupportedbyanappropriateResolution/Authority,asapplicable.AProxyFormformspartofthisAnnualReport.

3. Corporate Members intending to send their Authorised Representatives to attend the AnnualGeneralMeetingpursuanttoSection113oftheCompaniesAct,2013arerequestedtosendtotheCompany,acertifiedcopyoftherelevantBoardResolutionauthorisingtheirrepresentativetoattendandvoteintheirbehalfattheAnnualGeneralMeetingalongwiththespecimensignaturesoftheauthorisedrepresentatives.

4. IncaseofjointholdersattendingtheAnnualGeneralMeeting,onlysuchjointholderwhoishigherintheorderofnameswillbeentitledtovote.

5. IntermsofSection152oftheCompaniesAct,2013,Mr.S.R.Sharma(DIN:03096740)retiresbyrotationatthemeetingandbeingeligible,offerhimselfforre-appointment.TheBoardofDirectorsof theCompany recommendshis re-appointment. A brief resumeofDirectors proposed to beappointed / re-appointed at this Annual General Meeting, nature of their expertise in specificfunctional areas, names of Companies in which they hold Directorship and Membership /ChairmanshipsofBoardCommittees,shareholdingandrelationshipbetweenDirectors inter-se,stipulatedunderRegulation36ofSecuritiesandExchangeBoardofIndia(ListingObligationsandDisclosureRequirements)Regulations,2015andotherrequisiteinformationasperClause1.2.5ofSecretarialStandards-2onGeneralMeeting,issuedbytheInstituteofCompanySecretariesofIndia,areprovidedasannexuretothisNotice.

6. The Register ofMembers and share Transfer Books of the Companywill remain closed fromWednesday,September19,2018toMonday,September24,2018(bothdaysinclusive).

7. RelevantdocumentsreferredtointheaccompanyingNoticeandtheExplanatoryStatementwillbeavailableforinspectionbytheMembersattheRegisteredOfficeoftheCompanyonallworkingdays(exceptSaturdays,Sundaysandpublicholidays)between11.00a.m.and1.00p.m.uptothedateoftheAnnualGeneralMeetingandalsoattheAnnualGeneralMeetingvenue.

8. Members / Proxies should bring the enclosed Attendance Slip duly filled in, for attending theAnnualGeneralMeeting,alongwiththeAnnualReport.Memberswhoholdshares inelectronicform are requested towrite their DP ID and Client ID numbers and thosewho hold shares inphysicalformarerequestedtowritetheirFolioNumberintheAttendanceSlipforattendingtheAnnualGeneralMeetingtofacilitateidentificationofMembershipattheAnnualGeneralMeeting.DuplicateAttendanceSliporcopiesoftheAnnualReportwillnotbemadeavailableattheAnnualGeneralMeetingvenue.


9. TheSecuritiesandExchangeBoardofIndiahasmandatedthesubmissionofPermanentAccountNumber(“PAN”)byeveryparticipantinsecuritiesmarket.Membersholdingsharesinelectronicformare,therefore,requestedtosubmittheirPANtotheDepositoryParticipantswithwhomtheymaintaintheirdemataccounts.MembersholdingsharesinphysicalformshouldsubmittheirPANtotheRegistrarandSharesTransferAgentoftheCompany.

10. Membersholdingshares inphysical formare requested toconsiderconverting theirholding indematerialised form. TheMembers are requested to contact theRegistrar andShareTransferAgentoftheCompanyforassistanceinthisregard.

11. ForallmattersrelatingtotheChangeinAddress,ECSmandates,Bankdetails,Nomination,Powerof Attorney, etc., the Members are requested to approach the Registrar and Shares TransferAgentoftheCompanyincaseofsharesheldinphysicalformandtotheirrespectiveDepositoryParticipantsincaseofsharesheldinelectronicform.

12. MembersholdingsharesinphysicalformmayobtaintheNominationFormfromtheRegistrarandShareTransferAgentoftheCompanyandtheMembersholdingsharesintheelectronicformmayobtaintheNominationFormfromtheirrespectiveDepositoryParticipants.

13. PursuanttotheprovisionsofSection20,101andSection136oftheCompaniesAct,2013readwiththerelevantRulesmadethereunder,CompaniesarepermittedtoserveAnnualReportandothercommunicationthroughelectronicmodetothoseMemberswhohaveregisteredtheiremailaddresswitheithertheCompanyortheDepositoryParticipants.Members,whohavenotregisteredtheiremailaddresssofar,arerequestedtodosoimmediatelytosupportGreeninitiative,sothattheycanreceivetheAnnualReportandothercommunicationsfromtheCompanyelectronically,byregisteringtheiremailaddresswiththeRegistrarandShareTransferAgentoftheCompanyincasesharesareheld inphysical formandwith their respectiveDepositoryParticipants incasesharesareheldinelectronicform.Members,whohaveregisteredtheiremailaddress,areentitledtoreceivesuchcommunicationsinphysicalformuponrequest.

14. The Company has designated an exclusive e-mail id ([email protected]) for redressal ofInvestorComplaints/Grievances.Incaseyouhaveanyqueries/complaintsorgrievances,thenpleasewritetousatemailid([email protected]).

15. MembersdesirousofaskinganyquestionsattheAnnualGeneralMeeting,arerequestedtosendintheirquestionssoastoreachtheCompanyatleastsevendaysbeforetheAnnualGeneralMeetingsothatthesamecanbesuitablyreplied.

16. Pursuant to the provisions of Section 124 of the Companies Act, 2013 (Section 205A of theCompaniesAct,1956)readwiththeInvestorEducationandProtectionFundAuthority(Accounting,Audit,TransferandRefund)Rules,2016(“IEPFRules”)includinganystatutorymodification(s)orre-enactment thereof for the timebeing in force, dividendwhich remainsunpaidor unclaimedforaperiodofseven(7)yearsfromthedateofitstransfertotheunpaiddividendaccountoftheCompanywouldbetransferredto InvestorEducationandProtectionFund(“IEPF”).Accordingly,theCompanyhastransferredtotheIEPFallUnclaimedDividenduptoFinalDividend2007-08andnoDividendhasbeendeclaredthereafter,whichhasremainedunclaimedforaperiodofSevenYears.

Pursuant to theprovisionsofSection124(6)of theCompaniesAct,2013 readwith IEPFRulesincludinganystatutorymodification(s)or re-enactment thereof for the timebeing in force, theCompanyisrequiredtotransferallequitysharesinrespectofwhichdividendhasnotbeenpaidorclaimedforaperiodofsevenconsecutiveyearstothedemataccountoftheIEPFAuthorityinsuchmannerasmaybeprescribedundertheIEPFRules.TheShareholdersmaypleasenotethattheCompanyshalltransfertheconcernedsharesheldbytheminphysicalordematformtothedemataccountoftheIEPFAuthoritybytheduedate,asmaybeapplicable,aspertheprocedureprescribedundertheIEPFRules.


17. TheAnnualReportoftheCompanycirculatedtotheMembersoftheCompany,isalsoavailableonthewebsiteoftheCompany(www.primesec.com)andonthewebsiteoftheStockExchanges.

18. Routemapshowingdirectionstoreachtothevenueofthe35thAnnualGeneralMeetingisgivenattheendofthisAnnualReport,aspertherequirementoftheSecretarialStandards2on“GeneralMeetings”.

19. VotingOptions:

a) Pursuant to theprovisionsofSection108ofCompanies,Act,2013 readwith theRule20oftheCompanies(ManagementandAdministration)Rules,2014andRegulation44oftheSecuritiesandExchangeBoardofIndia(ListingObligationsandDisclosureRequirements)Regulations,2015,asamendedfromtimetotime,theCompanyispleasedtoprovidetoitsMembersthefacilitytoexercisetheirrighttovoteonResolutionsproposedtobeconsideredat the Annual General Meeting by electronic means through “Remote e-voting” (i.e. theMembersmaycasttheirvoteusinganelectronicvotingsystemfromaplaceotherthanthevenueof theAnnualGeneralMeeting).TheCompanyhasavailed theservicesofNationalSecuritiesDepositoryLimited(“NSDL”)forprovidinge-votingfacilitytotheMembers.

b) Thefacilityforvoting,eitherthroughe-votingsystemorthroughBallotForm/PollingPapershall also bemade available at the venue of the Annual GeneralMeeting. TheMembersattendingtheAnnualGeneralMeeting,whohavenotalreadycasttheirvotethroughremotee-voting, shall be able to exercise their voting rights at the venue of the Annual GeneralMeeting.TheMembers,whohavealreadycastedtheirvotethroughremotee-voting,mayattendtheAnnualGeneralMeetingbutshallnotbeentitledtocasttheirvoteagainatthevenueoftheAnnualGeneralMeeting.

c) Theprocessandmannerforremotee-votingisasunder:

A) Incaseamemberreceivesane-mailfromNSDL[formemberswhosee-mailIDsareregisteredwiththeCompany/DepositoryParticipants(s)]:

(i) Opene-mailandopenPDFfileviz;“PrimeSecuritiesLimitede-Voting.pdf”withyour Client ID or FolioNo. as password. The said PDF file contains your userIDandpassword/PINfore-voting.Pleasenotethatthispasswordisaninitialpassword.

(ii) LaunchinternetbrowserbytypingURL:https://www.evoting.nsdl.com.

(iii) ClickonShareholder–Login

(iv) IfyouarealreadyregisteredwithNSDLforremotee-voting,thenyoucanuseyourexistinguserIDandpassword/PINforcastingyourvote.

(v) Ifyouare logging in for thefirst time,pleaseenteryouruser IDandpasswordprovidedinthePDFfileattachedwiththeemailasinitialpassword.ClickLogin.

(vi) Passwordchangemenuappears.Changethepassword/PINwithnewpasswordofyourchoicewithminimum8digits/charactersorcombinationthereof.Notenewpassword.Itisstronglyrecommendednottoshareyourpasswordwithanyotherpersonandtakeutmostcaretokeepyourpasswordconfidential.

(vii) Homepageofremotee-votingopens.Clickonremotee-voting>ActivevotingCycles.

(viii) Select “EVEN (109284)” of “Prime Securities Limited”. Now you are ready forremotee-votingascastvotepageopens.

(ix) Cast your voteby selectingappropriateoptionandclickon “Submit” andalso“Confirm”whenprompted.

(x) Uponconfirmation,themessage“votecastsuccessfully”willbedisplayed.

(xi) Onceyouhavevotedontheresolution,youwillnotbeallowedtomodifyyourvote.


(xii) Institutionalshareholders(i.e.otherthanindividuals,HUF,NRIetc.)arerequiredto send scanned copy (PDF / JPG Format) of the relevant board resolution/ authority letter, etc. together with attested specimen signature of the dulyauthorizedsignatory(ies)whoareauthorizedtovote, to thescrutinizer throughe-mail to [email protected] with a copy marked to [email protected].

B) IncaseamemberreceivesphysicalcopyofthenoticeofAnnualGeneralMeetingandAttendanceSlip[formemberswhosee-mailIDsarenotregisteredwiththeCompany/DepositoryParticipants(s)orrequestingphysicalcopy]:

(i) Initialpasswordisprovidedatthebottomoftheattendanceslipfortheannualgeneralmeeting:

“EVEN(109284)” USERID PASSWORD/PIN

(ii) PleasefollowallstepsfromSr.No.(ii)toSr.No.(xii)above,tocastyourvote.

d) OtherInstructions:

1) Incaseofanyqueries,youmayreferthefrequentlyaskedquestions(FAQs)formembersande-votingusermanualformembersavailableatthedownloadsectionofwww.evoting.nsdl.comorcallontollfreeno:1800-222-990.

2) Youcanalsoupdateyourmobilenumberandemailidintheuserprofiledetailsofthefolio,whichmaybeusedforsendingfuturecommunications.

3) Theremotee-votingperiodwillcommenceat9.00a.m.onFriday,September21,2018andwillendat5.00p.m.onSunday,September23,2018.During thisperiod,membersof theCompany,holdingshareseitherinphysicalformorinelectronicform,asontheCut-offdate,i.e.Monday, September 17, 2018,may cast their vote electronically. The remote e-votingmoduleshallbedisabledbyNSDLforvotingthereafter.Oncethevoteonaresolutioniscastbythemember,themembershallnotbeallowedtochangeitsubsequently.

4) Thevoting rightsofMembersshallbe inproportion to their sharesof thepaid-upEquityShareCapitaloftheCompanyasontheCut-offdate,i.e.Monday,September17,2018.

5) ApersonwhosenamesappearintheRegisterofMembersorintheRegisterofBeneficialOwnersmaintainedbytheDepositoriesasontheCut-offdate,i.e.Monday,September17,2018,shallonlybeentitledtovoteontheResolutionssetforthinthisNoticeeitherbywayofremotee-votingorthroughe-votingsystem/ballotform/pollingpaperatthevenueoftheAnnualGeneralMeeting.

6) AnypersonwhoacquiressharesoftheCompanyandbecomesMemberoftheCompanyafterdispatchofthisnoticeandholdingsharesasontheCut-offdate,i.e.Monday,September17,2018,mayobtaintheloginIDandpasswordbysendinganemailtoprime@[email protected]./DPID&ClientID.However, ifyouarealreadyregisteredwithNSDLforremotee-voting,thenyoucanuseyourexistinguserIDandpasswordforcastingyourvote.Ifyoudon’trememberyourpassword,youcanresetyourpasswordbyusing“forgetuserdetails/password”[email protected]“PhysicalUserResetPassword”optionavailableonwww.evoting.nsdl.comorcontactNSDLatthefollowingTollFreeNo.:1800-222-990.


7) Mr.PramodS.ShahofM/s.PramodS.Shah&Associates,PractisingCompanySecretaries(MembershipNo.FCS3804),hasbeenappointedastheScrutinisertoscrutinisethee-votingprocessinafairandtransparentmanner.

8) At theAnnualGeneralMeeting,at theendof thediscussionon theResolutionsonwhichvotingistobeheld,theChairmanshallwiththeassistanceoftheScrutiniser,ordervotingforallthoseMemberswhoarepresentbuthavenotcasttheirvoteelectronicallyusingtheremotee-votingfacility.

9) The Scrutinizer shall, immediately after the conclusion of voting at the Annual GeneralMeeting, first count the votescastat theAnnualGeneralMeetingand thereafterunblockthevotescastthroughremotee-votinginthepresenceofatleasttwowitnessesnotintheemploymentoftheCompany.Scrutinisershallnotlaterthan48hoursofconclusionoftheAnnualGeneralMeeting,submitaConsolidatedScrutiniser’sReportofthetotalvotescastinfavouroragainst,ifany,totheChairmanorapersonauthorizedbyhiminwriting,whoshallcountersignthesame.

10) TheChairmanor a person authorised by him inwriting shall declare the result of votingforthwith.

11) TheresultsdeclaredalongwiththeReportoftheScrutinisershallbeplacedonthewebsiteoftheCompany(www.primesec.com)andonthewebsiteofNSDL(www.evoting.nsdl.com)immediatelyaftertheresultdeclaredbyChairmanorapersonauthorizedbyhiminwritingandthesameshallbecommunicatedtotheStockExchangeswheresharesoftheCompanyarelisted.

RegisteredOffice: ByOrderoftheBoardofDirectors1109/1110,MakerChambersV,NarimanPoint,Mumbai-400021CIN:L67120MH1982PLC026724 Ajay ShahEmail:[email protected] Vice President LegalWebsite:www.primesec.com & Company SecretaryMay29,2018 (ACS-14359)


EXPLANATORY STATEMENT PURSUANT SECTION 102 OF THE COMPANIES ACT, 2013

The followingExplanatoryStatement sets out all thematerial facts relating to theSpecial Businessmentionedatitemnos.3to8oftheaccompanyingnotice.

Item No. 3TheBoardofDirectorsoftheCompany(“theBoard”),attheirMeetingheldonJanuary14,2016,hadre-appointedMr.N.JayakumarasManagingDirectoroftheCompanyforafurtherperiodofFiveYearsw.e.f.February11,2016inaccordancewithArticle119oftheArticlesofAssociationoftheCompany.Mr.N.JayakumarhadrefrainedfromdrawinganyremunerationfromtheCompanysinceDecember2012inviewofadversefinancialsituationoftheCompanythen.InlightofsubstantialbetteringofCompany’sprospectsinlastfewquartersandbasedontherecommendationoftheNominationandRemunerationCommittee,Mr.N.Jayakumar,ManagingDirector,hadstarteddrawingremunerationw.e.f.fromJanuary1,2017asapprovedbytheMemberofthecompanyattheirMeetingheldonSeptember21,2017.BasedontherecommendationoftheNominationandRemunerationCommittee,theBoardofDirectorsoftheCompanyhas,subjecttoapprovaloftheMembersoftheCompany,revisedtheremunerationpayabletoMr.N.Jayakumar,ManagingDirector,w.e.f.April1,2018fortheremainderofhistermasManagingDirector. The approval of theMembers pursuant to Section 197(1) of the Companies Act, 2013, asamendedfromtimetotime,isnowsoughtfortherevisedremunerationpayabletoMr.N.Jayakumar,ManagingDirector,w.e.f.fromApril1,2018fortheremainderofhistermastheManagingDirector.

Mr.N.JayakumarisassociatedwiththeCompanysince1992andhewasdesignatedasaPresidentoftheCompanysince2002.HeaqualifiedprofessionalwithexpertiseinCorporateFinanceandInvestmentManagement and has vast experience in advising in areas of financial restructuring, evaluation ofbusinessplans/jointventureproposals/acquisitions,fundraisingandstrategicalliances.HeiswiththeCompanyformorethan26yearshandlingcorporaterelationships.BeforejoiningtheCompany,hehad7yearsexperienceinCitibank,N.A.asVicePresident,Head–MerchantBankingGroup&CorporateFinance,India.

Themain terms of appointment, remuneration, perquisites, etc. as set out in the Memorandum ofUnderstanding entered into between the Company andMr. N. Jayakumar, which are subject to theapprovaloftheMembersoftheCompany,areasfollows:

Term:PeriodofAppointment-FiveyearseffectiveFebruary11,2016

Salary:a) SalaryuptoamaximumofH40,00,000/-permonthforaperiodfromApril1,2018toFebruary10,

2021,withauthoritytotheBoardoraCommitteethereoftofixthesalarywithinthesaidmaximumamount.

Perquisites:a) UseoftheCompany’scarwithadriveroralternativelytheCompanywillmaintainatitsexpensea

carbelongingtotheManagingDirectorandwillalsoreimbursethesalaryofthedriveraspertherulesoftheCompany.

b) ReimbursementofCompanycarrunningandmaintenanceexpensesreasonablyincurredbyMr.N.JayakumarexclusivelyforthebusinessoftheCompany;


c) ReimbursementofMedicalexpensesactuallyincurredbyMr.N.Jayakumarandhisfamily;

d) Company’sContributiontoProvidentFundaspertherules;

e) BenefitofaCompanyGroupMediclaimPolicy;

f) GratuityaspertheGratuitySchemeoftheCompany;

g) ReimbursementofTravellingandEntertainmentexpensesreasonablyincurredbyhimexclusivelyforthebusinessoftheCompany;

h) Leaveonfull remunerationasper therulesof theCompanyfor thetimebeing in forcebutnotexceedingonemonth’sprivilegeleaveforevery12monthsservice;

PerquisiteshallbeevaluatedasperIncome-taxRules,whereverapplicable.Intheabsenceofanysuchrules,perquisitesshallbeevaluatedatactualcost.

Performance Bonus:Performance Bonus as may be recommended by Nomination and Remuneration Committee anddecidedbytheBoardofDirectorsbasedontheNetProfitsoftheCompanyinaparticularyearsubjecttotheoverallceilinglimitlaiddownunderSection196,197,203oftheCompaniesAct,2013.

TheperquisitesnamelycontributiontoProvidentFund,Gratuityandencashmentofleaveshallnotbeincludedinthecomputationoftheceilingonremuneration.

Notwithstandinganythinghereinabove,where inanyFinancialYearduringthecurrencyofhistenureasManagingDirector,theCompanyhasnoProfitsoritsProfitsareinadequate,theCompanywillpayremunerationbywayofsalaryandperquisiteasabovesubjecttotheceilingspecifiedunderScheduleVtotheCompaniesAct,2013.

The followingadditional informationas requiredbyScheduleV to theCompaniesAct,2013 isgivenbelow:

1) General Information: a) Nature of Industry:

TheCompanyisinthebusinessofCorporateAdvisoryandInvestmentBanking.

b) Date or expected date of commencement of commercial production:

NotapplicableastheCompanyisanexistingCompanyandisinoperationssince1982.

c) In case of new companies, expected date of commencement of activities as per project approvedbyfinancialinstitutionsappearingintheprospectus:

Notapplicable.


d) Financial performance based on given indicators:

AuditedStandaloneFinancialStatementsfortheYearendedMarch31,2018:

(H inlacs)

Particulars Year ended March 31, 2018

Year ended March 31, 2017

IncomefromOperationsandotherIncome 899.42 676.60OperatingProfit (beforeinterest,depreciation&tax)

616.96 907.55

Profit/(Loss)beforeTax 325.61 (690.97)Profit/(Loss)afterTax 332.16 (723.86)

AuditedConsolidatedFinancialStatementsfortheYearendedMarch31,2018:(H inlacs)



IncomefromOperationsandotherIncome 2,402.47 1,957.65OperatingProfit (beforeinterest,depreciation&tax)

809.02 1,087.36

Profit/(Loss)beforeTax 1,715.00 1,934.84Profit/(Loss)afterTax 1,414.80 1,301.87

e) Foreign investments or collaborations, if any:

Notapplicable.

2) Information about the Appointee:

a) Background details:

Mr.N.Jayakumar,aged57years, isBachelorofTechnology,MechanicalEngineering(I.I.T.Delhi)(1978-1983)&P.G.D.M.(MBA),IIMAhmedabad(1983-1985).HeisassociatedwiththeCompanysince1992andhewasdesignatedasaPresidentoftheCompanysince2002.Heaqualifiedprofessionalwithexpertise inCorporateFinanceand InvestmentManagementandhasvastexperienceinadvisinginareasoffinancialrestructuring,evaluationofbusinessplans/jointventureproposals/acquisitions,fundraisingandstrategicalliances.HeiswiththeCompany formore than26yearshandlingcorporate relationships.Before joining theCompany,hehad7yearsexperience inCitibank,N.A.asVicePresident,Head-MerchantBankingGroup&CorporateFinance,India.AsaManagingDirector,heshallcarryoutsuchfunctions,exercisesuchpowersandperformsuchdutiesastheBoardshall fromtimetotimeinitsabsolutediscretiondetermineandentrusttohim.Subjecttothesuperintendence,controlanddirectionoftheBoard,heshallhavethegeneralcontrolofthebusinessoftheCompanyandbevestedwiththemanagementandday-to-dayaffairsoftheCompany.

b) Past Remuneration:

Mr.N.JayakumarhasbeenappointedasManagingDirectoroftheCompanyw.e.f.February12,2011. InviewofadversefinancialsituationoftheCompany intheearlieryears,Mr.N.JayakumarhadrefrainedfromdrawinganyremunerationfromtheCompanysinceDecember2012tillDecember31,2016.FortheFinancialYearendedonMarch31,2018andMarch31,2017,theCompanyhaspaidH133.18lacsandH34.23lacsrespectivelyasremunerationtoMr.N.Jayakumar.


c) Recognition or Awards:

Nil

d) Jobprofileandhissuitability:

Sameasaboveinitemnoa)hereinabove.

e) Remuneration proposed:

TheCompanyproposestopaytheremunerationtoMr.N.JayakumaraspertheresolutionsproposedtobepassedbytheMembersintheAnnualGeneralMeetingoftheCompany.

f) Comparativeremunerationprofilewithrespecttoindustry,sizeoftheCompany,profileofthe position and person:

Taking into consideration the size of the Company, the profile of Mr. N. Jayakumar, theresponsibilities shouldered by him and industry benchmarks, the remuneration proposedto be paid is commensuratewith the remuneration packages paid to similar senior levelcounterpartsinthecompanies.

g) Pecuniary relationship directly or indirectly with the Company, or relationship with the managerial personnel, if any:

Besidestheremunerationproposedtobepaidtohim,Mr.N.JayakumardoesnothaveanyotherpecuniaryrelationshipwiththeCompany.

3) Other Information:

a) Reasonsforlossorinadequateprofits:

TheCompany ismainly involved in theCorporateAdvisory and InvestmentBanking.Thebusinessof theCompanyand itsperformance is linked to capitalmarket conditionsandsuccessfulclosureofdeals.

b) Steps taken or proposed to be taken for improvement:

The Company has been continuously enhancing its client list. The Company has madesignificantstridesinestablishingstrongerclientrelationships.TheCompanyisfocusingonprovidinginnovativebusinesssolutionstoitsclientsintheareaoffundraisingandmergerandacquisitions.

c) Expectedincreaseinproductivityandprofitsinmeasurableterms:

With better capitalmarket conditions and increased client relationships, the Company isexpectedtostepuptherevenuesandprofitssubstantiallyinfuture.

4) Disclosures:

a) Remuneration package of the managerial person:

Fullydescribedintheexplanatorystatementasstatedabove.

b) Disclosures in the Board of Directors’ Report under the heading “Corporate Governance” included in Annual Report 2017-18:

The requisite details of remuneration etc. of Directors are included in the CorporateGovernanceReport,formingpartoftheAnnualReportofF.Y.2017-18oftheCompany.

The Memorandum of Understanding entered into between the Company and Mr. N.


Jayakumar is available for inspection to the Members at the Registered Office of theCompanybetween11.00a.m.and1.00p.m.onallworkingdaysexceptSaturdays,SundaysandPublicHolidays.

ExceptMr. N. Jayakumar, none of the Directors or any KeyManagerial Personnel of theCompanyorrelativesofanyofthemare,inanyway,concernedorinterestedinthisresolution.

The Board of Directors recommends this resolution for approval by theMembers of theCompanybyaSpecialResolution.

Item No. 4

TheBoardofDirectorsoftheCompany(“theBoard”)attheirMeetingheldonMay29,2018,basedontherecommendationoftheNominationandRemunerationCommittee,hadappointedMr.VineetSuriasExecutiveDirectoroftheCompanyforaperiodofFiveYearsw.e.f.May29,2018inaccordancewithArticle119oftheArticlesofAssociationoftheCompanyandsubjecttoapprovaloftheMembersoftheCompany.TheapprovaloftheMemberspursuanttoSection197(1)oftheCompaniesAct,2013,asamendedfromtimetotime,isnowsoughtfortheappointmentforaperiodofFiveYearsw.e.f.May29,2018andforpaymentofremunerationtoMr.VineetSuri,ExecutiveDirector,w.e.f.fromMay29,2018fortheperiodof3Years.

Mr.VineetSuri isassociatedwiththeCompanysinceDecember2016asHeadofCorporateFinance& Investment Banking (including theRestructuring business). He started his careerwith Citibank inMumbai and London, andhas over 20 years of Banking /Corporate Finance& InvestmentBankingexperience,havingworkedwithleadingbanksinMumbai,London,Riyadh&Bahrain.Hisareasoffocushave been Structured Finance, CapitalMarkets,M&A / Acquisition Financing, ABF, Project Advisory,TelecomFinancing, Debt Syndications and Islamic Financing.He hasworked on and led numeroustransactionsforclientsspreadacrossIndia,Europe,MiddleEastandAfrica.HeisaCharteredAccountanttrainedunderPriceWaterhouse,andaBachelorofCommercefromSydenhamCollegeofCommerce&Economics,Mumbai.

Themain terms of appointment, remuneration, perquisites, etc. as set out in the Memorandum ofUnderstandingenteredintobetweentheCompanyandMr.VineetSuri,whicharesubjecttotheapprovaloftheMembersoftheCompany,areasfollows:

Term:

PeriodofAppointment-FiveyearseffectiveMay29,2018

Salary:

a) SalaryuptoamaximumofH10,00,000/-permonth foraperiod fromMay29,2018 toMay28,2021,withauthoritytotheBoardoraCommitteethereoftofixthesalarywithinthesaidmaximumamount.

Perquisites:

a) UseoftheCompany’scarwithadriveroralternativelytheCompanywillmaintainatitsexpenseacarbelongingtotheManagingDirectorandwillalsoreimbursethesalaryofthedriveraspertherulesoftheCompany.

b) ReimbursementofCompanycarrunningandmaintenanceexpensesreasonablyincurredbyMr.VineetSuriexclusivelyforthebusinessoftheCompany;

c) Company’sContributiontoProvidentFundaspertherules;


d) BenefitofaCompanyGroupMediclaimPolicy;

e) GratuityaspertheGratuitySchemeoftheCompany;

f) ReimbursementofTravellingandEntertainmentexpensesreasonablyincurredbyhimexclusivelyforthebusinessoftheCompany;

g) Leaveonfull remunerationasper therulesof theCompanyfor thetimebeing in forcebutnotexceedingonemonth’sprivilegeleaveforevery12monthsservice;

PerquisiteshallbeevaluatedasperIncome-taxRules,whereverapplicable.Intheabsenceofanysuchrules,perquisitesshallbeevaluatedatactualcost.

Performance Bonus:

Performance Bonus as may be recommended by Nomination and Remuneration Committee anddecidedbytheBoardofDirectorsbasedontheNetProfitsoftheCompanyinaparticularyearsubjecttotheoverallceilinglimitlaiddownunderSection196,197,203oftheCompaniesAct,2013.

TheperquisitesnamelycontributiontoProvidentFund,Gratuityandencashmentofleaveshallnotbeincludedinthecomputationoftheceilingonremuneration.

Notwithstandinganythinghereinabove,where inanyFinancialYearduringthecurrencyofhistenureasExecutiveDirector,theCompanyhasnoProfitsoritsProfitsareinadequate,theCompanywillpayremunerationbywayofsalaryandperquisiteasabovesubjecttotheceilingspecifiedunderScheduleVtotheCompaniesAct,2013.

The followingadditional informationas requiredbyScheduleV to theCompaniesAct,2013 isgivenbelow:

1) General Information:

a) Nature of Industry:

TheCompanyisinthebusinessofCorporateAdvisoryandInvestmentBanking.

b) Date or expected date of commencement of commercial production:

NotapplicableastheCompanyisanexistingCompanyandisinoperationssince1982.

c) In case of new companies, expected date of commencement of activities as per project approvedbyfinancialinstitutionsappearingintheprospectus:

Notapplicable.

d) Financial performance based on given indicators:

AuditedStandaloneFinancialStatementsfortheYearendedMarch31,2018:

(H inlacs)



IncomefromOperationsandotherIncome 899.42 676.60OperatingProfit(beforeinterest,depreciation&tax)

616.96 907.55

Profit/(Loss)beforeTax 325.61 (690.97)Profit/(Loss)afterTax 332.16 (723.86)


AuditedConsolidatedFinancialStatementsfortheYearendedMarch31,2018:(H inlacs)



IncomefromOperationsandotherIncome 2,402.47 1,957.65OperatingProfit(beforeinterest,depreciation&tax)

809.02 1,087.36

Profit/(Loss)beforeTax 1,715.00 1,934.84Profit/(Loss)afterTax 1,414.80 1,301.87

e) Foreign investments or collaborations, if any:

Notapplicable.

2) Information about the Appointee:

a) Background details:

Mr. Vineet Suri, aged 52 years, is a He is a Chartered Accountant trained under PriceWaterhouse, and a Bachelor of Commerce from Sydenham College of Commerce &Economics,Mumbai.HeisassociatedwiththeCompanysinceDecember2016asHeadofCorporateFinance&InvestmentBanking(includingtheRestructuringbusiness).HestartedhiscareerwithCitibankinMumbaiandLondon,andhasover20yearsofBanking/CorporateFinance& InvestmentBanking experience, havingworkedwith leadingbanks inMumbai,London,Riyadh&Bahrain.HisareasoffocushavebeenStructuredFinance,CapitalMarkets,M&A/AcquisitionFinancing,ABF,ProjectAdvisory,TelecomFinancing,DebtSyndicationsandIslamicFinancing.HehasworkedonandlednumeroustransactionsforclientsspreadacrossIndia,Europe,MiddleEastandAfrica.AsanExecutiveDirector,heshallcarryoutsuchfunctions,exercisesuchpowersandperformsuchdutiesastheBoardshall fromtimetotimeinitsabsolutediscretiondetermineandentrusttohim.Subjecttothesuperintendence,controlanddirectionoftheBoard,heshallhavethegeneralcontroloftheInvestmentBankingandCorporateAdvisorybusinessoftheCompany.

b) Past Remuneration:

Mr.VineetSurihasbeenappointedasExecutiveDirectoroftheCompanyw.e.f.May29,2018.FortheFinancialYearendedonMarch31,2018andMarch31,2017,theCompanyhaspaidH48lacsandH14.58lacsrespectivelyasremunerationtoMr.VineetSuri.

c) Recognition or Awards:

Nil

d) Jobprofileandhissuitability:

Sameasaboveinitemnoa)hereinabove.

e) Remuneration proposed:

TheCompanyproposes topay the remuneration toMr.VineetSuriasper the resolutionsproposedtobepassedbytheMembersintheAnnualGeneralMeetingoftheCompany.

f) Comparativeremunerationprofilewithrespecttoindustry,sizeoftheCompany,profileofthe position and person:

Taking into consideration the size of the Company, the profile of Mr. Vineet Suri, theresponsibilities shouldered by him and industry benchmarks, the remuneration proposed


to be paid is commensuratewith the remuneration packages paid to similar senior levelcounterpartsinthecompanies.

g) Pecuniary relationship directly or indirectly with the Company, or relationship with the managerial personnel, if any:

Besidestheremunerationproposedtobepaidtohim,Mr.VineetSuridoesnothaveanyotherpecuniaryrelationshipwiththeCompany.

3) Other Information:

a) Reasonsforlossorinadequateprofits:

TheCompany ismainly involved in theCorporateAdvisory and InvestmentBanking.Thebusinessof theCompanyand itsperformance is linked to capitalmarket conditionsandsuccessfulclosureofdeals.

b) Steps taken or proposed to be taken for improvement:

The Company has been continuously enhancing its client list. The Company has madesignificantstridesinestablishingstrongerclientrelationships.TheCompanyisfocusingonprovidinginnovativebusinesssolutionstoitsclientsintheareaoffundraisingandmergerandacquisitions.

c) Expectedincreaseinproductivityandprofitsinmeasurableterms:

With better capitalmarket conditions and increased client relationships, the Company isexpectedtostepuptherevenuesandprofitssubstantiallyinfuture.

4) Disclosures:

a) Remuneration package of the managerial person:

Fullydescribedintheexplanatorystatementasstatedabove.

b) Disclosures in the Board of Directors’ Report under the heading “Corporate Governance” included in Annual Report 2017-18:

The requisite details of remuneration etc. of Directors are included in the CorporateGovernanceReport,formingpartoftheAnnualReportofF.Y.2017-18oftheCompany.

TheMemorandumofUnderstandingenteredintobetweentheCompanyandMr.VineetSuriisavailableforinspectiontotheMembersattheRegisteredOfficeoftheCompanybetween11.00a.m.and1.00p.m.onallworkingdaysexceptSaturdays,SundaysandPublicHolidays.

ExceptMr.VineetSuri,noneoftheDirectorsoranyKeyManagerialPersonneloftheCompanyorrelativesofanyofthemare,inanyway,concernedorinterestedinthisresolution.

The Board of Directors recommends this resolution for approval by theMembers of theCompanybyaSpecialResolution.

Item No. 5TheMemorandumandArticlesofAssociationoftheCompanycurrentlyinforcewereoriginallyadoptedwhentheCompanywasincorporatedundertheCompaniesAct,1956andthesamewereamendedfromtimetotimeinaccordancewiththeprovisionsoftheCompaniesAct,1956andtheCompaniesAct,2013fromtimetotime.SeveralregulationsintheexistingAOAcontainreferencestospecificsectionsoftheCompaniesAct,1956andsomeregulationsintheexistingAOAarenolongerinconformitywiththeAct.WiththeintroductionoftheCompaniesAct,2013,itisproposedtoamendtheexistingMemorandumandArticlesofAssociationtomakeitconsistentwiththeprovisionsofCompaniesAct,2013includingtheRulesframedthereunder.


AcopyoftheproposedsetofnewMemorandumandArticlesofAssociationoftheCompanywouldbeavailableforinspectionattheregisteredofficeoftheCompanyonallworkingdays,exceptSaturdays,SundaysandPublicHolidays,between11.00a.m.to1.00p.m.uptothedateofthe35thAnnualGeneralMeetingandduringthe35thAnnualGeneralMeeting.TheproposeddraftofMemorandumandArticlesofAssociation is alsoavailableon theCompany’swebsiteatwww.primesec.com forperusalby theShareholders.

NoneoftheDirectorsandKeyManagerialPersonnelsoftheCompanyorrelativesofanyofthemare,inanyway,concernedorinterestedinthisResolutions.

TheBoardofDirectorsrecommendsthisresolutionforapprovalbytheMembersoftheCompanybyaSpecialResolution.

Item No. 6, 7 and 8The Company operates in the financial services industry and the major services provided by theCompanyi.e.Investment/MerchantBankingandCorporateAdvisoryServicesarepeopledriven.TheCompanybelievesthatthegrowthwitnessedbytheCompanyistheresultoftheeffortsputinbyitsemployees.TheBoardhasidentifiedtheneedtorewardtheemployeesbyenablingthemtoparticipateinthefuturegrowthandfinancialsuccessoftheCompany.EquitybasedcompensationisconsideredtobeanintegralpartofemployeecompensationacrosssectorswhichenablesalignmentofpersonalgoalsoftheemployeeswithorganizationalobjectivesbyparticipatingintheownershipoftheCompanythroughsharebasedcompensationscheme.TheBoardofDirectorsoftheCompanyattheirMeetingheldonMay29,2018hasapprovedimplementationoftheEmployeeStockOptionScheme2018(“ESOS2018”),withaviewtoattractandretainkeytalentsworkingwiththeCompanyanditsSubsidiaryCompaniesbywayofrewardingtheirperformanceandmotivatethemtocontributetotheoverallcorporategrowthandprofitability.TheBoardhasauthorisedtheNominationandRemunerationCommitteetoadministerESOS2018andwillformulateitsdetailedtermsandconditions.

Pursuant to provisions of Securities and ExchangeBoard of India (ShareBased EmployeeBenefits)Regulations, (“SEBI SBEBRegulations”), the approval of theMembers of the Company is sought toimplementESOS2018andgrantofoptionstotheeligibleEmployees/DirectorsoftheCompanyandthatofitsSubsidiaryCompaniesasdecidedbytheNominationandRemunerationCommitteefromtimetotimeinduecomplianceoftheSEBISBEBRegulations.

ThemainfeaturesoftheESOS2018areasunder:

1. Brief Description of the Scheme:

ESOS2018isintendedtorewardtheeligiblepermanentEmployees/DirectorsoftheCompanyand itsSubsidiaryCompanies in Indiaandabroad, for theirperformanceandtomotivate themtocontributetothegrowthandprofitabilityoftheCompany.YourCompanyalsointendstouseESOS2018toretaintalentintheorganizationasitviewsoptionsasinstrumentsthatwouldenabletheemployeestosharethevaluetheycreatefortheCompanyandalignindividualobjectivesofemployeeswithobjectivesoftheCompanyintheyearstocome.

TheCompany,intermsoftheSEBISBEBRegulations,contemplatestoimplementationofESOS2018bywayofissueoffreshEquitySharesbytheCompany.

2. Total number of Options to be granted:

A total of upto 45,00,000 (Forty Five Lacs)Optionswould be available for grant to the eligiblepermanent Employees / Directors of the Company and its Subsidiary Companies under ESOS2018, inoneormore tranches,detailed termsofwhichare tobe formulatedby theBoardbutsubjecttothebroadparametersoftheSchemetobeapprovedbytheMembers.EachsuchOptionwhenexercisedwouldbeconverted intoonenewEquityShareofH5/-eachfullypaid-upof the


Company.TheOptionshallnotbepledged,hypothecated,mortgagedorotherwisealienatedinanyothermanner.

Vestedoptions lapsedduetonon-exerciseand/orunvestedoptionsthatgetcancelledduetoresignation/terminationoftheemployeesorotherwise,wouldbeavailableforbeingre-grantedatafuturedate.TheBoardisauthorizedtore-grantsuchlapsed/cancelledoptionsaspertheprovisionsofESOS2018,withinoverallceiling.

SEBI SBEB Regulations require that in case of any corporate action(s) such as rights, bonus,merger,de-merger,amalgamation,saleofdivisionoranyotherformofcorporaterestructuring,a fairand reasonableadjustmentneeds tobemade to theoptionsgranted.Accordingly, ifanyadditionalEquitySharesare required tobe issuedpursuant toanycorporateaction, theaboveceiling45,00,000(FortyFiveLacs)EquitySharesshallbedeemedtobeincreasedinproportionofsuchadditionalEquitySharesissued.

3. Identification of Classes of Employees entitled to participate and be beneficiary in theESOS 2018:

FollowingclassesofEmployeesareentitledtoparticipateinESOS2018:

a) PermanentEmployeesoftheCompanyworkinginIndiaoroutofIndia;

b) DirectorsoftheCompany;and

c) PermanentEmployeesandDirectorsoftheSubsidiaryCompanies.

FollowingpersonsarenoteligibletoparticipateinESOS2018:

a) EmployeeorDirectorwhoisaPromoterorbelongstothePromoterGroup;

b) DirectorwhoeitherbyhimselforthroughhisrelativesorthroughanyBodyCorporate,directly or indirectly holdsmore than 10% of the outstanding Equity Shares of theCompany;and

c) IndependentDirectorwithinthemeaningoftheCompaniesAct,2013.

4. Requirements of Vesting and Period of Vesting:

OptionsgrantedunderESOS2018wouldvestnotlessthan1(One)YearfromthedateofgrantofsuchOptions.Vestingmayoccurinoneormoretranchesorotherwise.Thevestingdatesinrespectof theOptionsgrantedunderESOS2018mayvary fromEmployee toEmployeeoranyclassthereofand/orinrespectofthenumberorpercentageofOptionsgrantedtoanEmployee.TheNominationandRemunerationCommitteemay,atitsdiscretion,laydowncertainperformancemetricsontheachievementofwhichsuchOptionswouldvest,thedetailedtermsandconditionsrelatingtosuchvesting,andtheproportioninwhichOptionsgrantedwouldvest.

Options granted under ESOS 2018 shall vest so long as an Employee continues to be in theemployment of the Company / Subsidiary Companies, as the case may be, unless suchemploymentisdiscontinuedonaccountofdeath,permanentdisablementoronretirement.Intheeventofdeathofanemployeewhileinemployment,alltheOptionsgrantedtohimtillsuchdateshallvestinthelegalheirsornomineesofthedeceasedEmployee.IncasetheEmployeesuffersapermanent incapacitywhile inemployment, all theOptionsgranted tohimason thedateofpermanentincapacityshallvestinhimonthatdate.

If the eligible Employee voluntarily terminates employment with the Company / SubsidiaryCompanies, as the casemaybe, theOptions to the extent not vested shall lapse / expire andbe forfeited forthwith. However, this shall not be applicable to eligible Employees who haveresignedorwhomayresignfromtimetotimetojoinCompanies,approvedbytheNominationand


RemunerationCommittee, thathavebeenestablishedorpromotedorsetup(whethersolelyorjointlywithanyotherentity)bytheCompany.

5. Maximum period within which the Options shall be vested:

OptionsgrantedunderESOS2018wouldvestwithinamaximumperiodof5(Five)YearsfromthedateofgrantofsuchOptions.

6. Exercise Price or Pricing Formula:

TheExercisePricewouldbedeterminedbytheNominationandRemunerationCommitteeonthedateofGrant ofOptions in accordancewith theSEBISESBRegulations, subject to conditionsfor payment of Exercise Price in themanner prescribed by theNomination andRemunerationCommittee.

7. Exercise Period and Process of Exercise:

The Exercise Period would commence from the date of vesting and will expire at the end ofFiveYears from thedateofVestingorsuchperiodasmaybedecidedby theNominationandRemunerationCommittee.

TheVestedOptionswouldbeexercisablebytheemployeesbysubmittingawrittenapplicationtotheCompanyalongwiththepaymentofExercisePriceandonexecutionofsuchotherdocuments,asmaybeprescribedbytheNominationandRemunerationCommittee.Theoptionsshalllapseifnotexercisedwithinthespecifiedexerciseperiod.

8. Appraisal process for determining the eligibility of Employees to ESOS 2018:

The appraisal process for determining the eligibility of the employeeswill be specified by theNomination and Remuneration Committee and will be based on criteria such as seniority ofthe employees, length of service, performance record, merit, contribution and conduct of theemployees, future potential and / or any such other criteria that may be determined by theNominationandRemunerationCommitteeatitssolediscretion.

9. Maximum number of Options to be issued per Employee and in an aggregate

The maximum number of Options granted to any single eligible Employee shall not exceed15,00,000OptionsatthetimeofGrantoftheOption.TheaggregateofallsuchOptionsshallnotexceed45,00,000Options.

10. MaximumQuantumofbenefitstobeprovidedperemployeeundertheESOS2018:

ThemaximumquantumofbenefitsunderlyingtheOptions issuedtoaneligibleemployeeshalldependuponthemarketpriceoftheEquitySharesasonthedateofsaleofEquitySharesallottedpursuanttotheexerciseofOptions.

11. Whether ESOS 2018 is to be implemented and administered directly by the Company or through Trust:

ESOS2018shallbeimplementedandadministereddirectlybytheCompany.

12. Whether ESOS 2018 involves new issue of Equity Shares by the Company or Secondary Acquisition by the Trust or both:

ESOS2018contemplatesnewIssueofEquitySharesbytheCompany.

13. The amount of loan provided for implementation of ESOS 2018 by the Company to the Trust, its tenure, utilisation, repayment terms etc.:

The Company is not providing any loan for ESOS 2018 purpose, as Company is directlyimplementingtheplan.


14. Maximum percentage of Secondary Acquisition (subject to limits specified under theRegulations) that can be made by the Trust for the purchase under the scheme:

NotapplicableforimplementationofESOS2018astheCompanyisdirectlyimplementingtheplanbywayofnewissueofEquityShares.

15. Accounting and Disclosure Policies:

TheCompanyshallcomplywith the “GuidanceNoteonAccounting forEmployeeShareBasedPayments”and/oranyrelevantAccountingStandardsasmaybeprescribedbytheInstituteofCharteredAccountantsofIndiafromtimetotime,includingthedisclosurerequirementsprescribedtherein.

16. Method of Valuation:

TheCompanyshallusetheintrinsicvaluemethodforcomputingthecompensationcostfortheOptionsgranted.ThedifferencebetweentheemployeecompensationcostsocomputedandthecompensationcostthatshallhavebeenrecognisediftheCompanyhadusedthefairvalueoftheOptionsandalsotheimpactofthisdifferenceontheprofitsandonEPSoftheCompanyshallbedisclosedintheDirectors’Report.

ThebenefitsofESOS2018shallalsobeextendedtothepermanentEmployeesandDirectorsoftheSubsidiaryCompaniesof theCompany, in thesamemannerandsubject to the termsandconditionsasmentionedherein.TheaggregateOptionsissuedintermsofESOS2018shallnotexceedtheoveralllimitasmentionedintheESOS2018.SEBISESBRegulationsprovideforseparateapprovalofMemberstobeobtainedforextendingthebenefitsoftheSchemetoEmployeesandDirectorsofSubsidiaryCompaniesoftheCompany.

In termsof theprovisionsofSection62(1)(b) andall other applicableprovisions, if any, of theCompanies Act, 2013 and Regulations 6 of the SEBI SESB Regulations, the approval of theMembersisbeingsoughtbywayofSpecialResolutions.

AdraftcopyofESOS2018isavailableforinspectionattheRegisteredOfficeoftheCompanyonallworkingdays (excludingSaturday, SundayandHolidays) till thedateof theAnnualGeneralMeeting.

TheDirectorsandKeyManagerialPersonnelsoftheCompanymaybedeemedtobeconcernedorinterestedintheseResolutionsonlytotheextentofanyOptionsthatmaybegrantedtothemandtheresultantequitysharesissued,asapplicable.

TheBoardofDirectorsrecommendsthisresolutionforapprovalbytheMembersoftheCompanybyaSpecialResolution.

RegisteredOffice: ByOrderoftheBoardofDirectors1109/1110,MakerChambersV,NarimanPoint,Mumbai-400021CIN:L67120MH1982PLC026724 Ajay ShahEmail:[email protected] Vice President LegalWebsite:www.primesec.com & Company SecretaryMay29,2018 (ACS-14359)


Details of Director seeking Appointment / Re-appointment at 35th Annual General Meeting

[PursuanttotheRegulation26and36oftheSecuritiesandExchangeBoardofIndia(ListingObligationsandDisclosureRequirements)Regulations,2015and

SecretarialStandards2(SS-2)onGeneralMeetings]

Name of Director Mr. S. R. Sharma (*) Mr. Vineet SuriDirectorIdentificationNumber(DIN) 03096740 07995566

DateofBirth August7,1959 December21,1966

DateofFirstAppointment January25,2011 May29,2018Qualifications B.Tech.(Chemical

Engineering),IITDelhi,PGDM,IIM-Ahmedabad

CharteredAccountant

ExpertiseinSpecificFunctionalArea

Mr.S.R.SharmaisaqualifiedprofessionalgraduatedfromIITDelhiasaChemicalEngineerandreceivedhispostgraduatediplomainmanagement,PGDMfromtheIIMatAhmedabad.Hehasawideandvariedexperienceacrossmultiplesectorsincludingindustrialandspecialitychemicals,FMCGandfinancialservices.HewasbasedinJapanfor9yearswhereheworkedforShinseiBank,aleadingJapanesebankwhichhassetnewbenchmarksforconsumerbanking.HehasspecializedinthetransformationofbusinessprocessesbothcustomerfacingandposttransactionoperationsbyleveragingtheuseofIT.

Mr.VineetSuriistheHeadofCorporateFinance&InvestmentBanking(includingtheRestructuringbusiness)atPrime.HestartedhiscareerwithCitibankinMumbaiandLondon,andhasover20yearsofBanking/CorporateFinance&InvestmentBankingexperience,havingworkedwithleadingbanksinMumbai,London,Riyadh&Bahrain.HisareasoffocushavebeenStructuredFinance,CapitalMarkets,M&A/AcquisitionFinancing,ABF,ProjectAdvisory,TelecomFinancing,DebtSyndicationsandIslamicFinancing.HehasworkedonandlednumeroustransactionsforclientsspreadacrossIndia,Europe,MiddleEastandAfrica.HeisaCharteredAccountanttrainedunderPriceWaterhouse,andaBachelorofCommercefromSydenhamCollegeofCommerce&Economics,Mumbai.

NumberofMeetingsoftheBoardattendedduringtheyear

Six N.A.


Name of Director Mr. S. R. Sharma (*) Mr. Vineet SuriDirectorshipheldinotherPublicCompanies(excludingForeignCompaniesandSection8Companies)

PrimesecInvestmentsLimitedAsiaBioEnergy(India)Limited

None

Memberships/ChairmanshipsofCommitteesofotherCompanies(includesonlyAuditCommitteeandStakeholderRelationshipCommittee)

None None

Inter-serelationshipwithotherDirectorsandKeyManagerialPersonnel

Nil Nil

ShareholdingintheCompany

Nil 16,043EquityShares

*Mr.S.R.Sharmaretiresbyrotationandbeingeligibleoffershimselfforre-appointment.

ForotherdetailssuchasNumberofBoardMeetingsattendedduringtheFinancialYear2017-18andtheRemunerationdrawnbytheaboveDirectors,pleaserefertotheCorporateGovernanceReportformingpartofthisAnnualReport.


StatutorySection


DIRECTORS’ REPORT

Your Directors are pleased to present their 35th Annual Report on the business and operations of the

Company along with the Audited Financial Statements for the Financial Year ended March 31, 2018.

FINANCIAL HIGHLIGHTS(H in lacs)

Particulars Consolidated Standalone

March 31,

2018

March 31,

2017

March 31,

2018

March 31,

2017

Total Revenues 2,402.47 1,957.65 899.42 676.60

Total Expenses 792.19 1,072.47 601.37 894.01

Profit / (Loss) before Exceptional Items

& Tax

1,610.28 885.18 298.05 (217.41)

Exceptional Items 104.71 1,049.66 27.56 (473.56)

Profit / (Loss) before Tax 1,714.99 1,934.84 325.61 (690.97)

Tax Expenses 284.51 593.53 (21.59) Nil

Profit / (Loss) after Tax 1,430.48 1,341.31 347.20 (690.97)

Other Comprehensive Income / (Loss)

(Net of Tax)

(15.69) (39.43) (15.04) (32.89)

Total Comprehensive Income 1,414.79 1,301.88 332.16 (723.86)

The Company has prepared the financial

statements for the financial year ended March

31, 2018 under Section 129, 133 and Schedule

II to the Companies Act, 2013 read with the

Companies (Indian Accounting Standards)

Rules, 2015 (Ind-AS), as amended. Figures for the

financial year ended March 31, 2017 have been

restated as per Ind-AS and therefore may not

be comparable with financials for financial year

ended March 31, 2017 approved by the Directors

and disclosed in the financial statements of

previous year.

BUSINESS REVIEW & PROSPECTSAs you will note from the results, the year

gone by has been satisfying and has helped

in creating a base for sustained growth in our

activity in the coming months. The hallmark

of our work has been innovation and focused

execution. The mandates we have executed

range from corporate restructuring, debt

and equity issuances and strategic corporate

advisory. Repeat business, referrals drive healthy

deal flow and our teams have been busy! We will

add to our team to increase capacity as per the

demand of the business.

The temporary effects of demonetization have

now faded and economic growth in the latest

quarter is expected to top 7.7%. Growth is likely to

be robust across sectors especially in agriculture

and construction, which saw a negative rate of

growth of 3.9% in the last quarter. This is clearly

indicating that the lingering effects, if any were

there, of demonetization and the roll out of

GST are firmly in the rear-view mirror. Firms in

key sectors, autos, cement, steel are reporting

robust growth rates and this will trigger fresh

investments. As the investment cycle begins

its cyclical uptrend, deal flow will inevitably

increase. We see this in the robust pipeline of

deals.


This year’s southwest monsoon ended the June-

September season with 5% lower than average

rainfall and expectations of a slightly lower output

of kharif, or summer-sown crops, after bouts

of floods and dry weather in different parts of

the country. Forecasts for the current year are

positive and the onset of monsoon is expected

to be on time! This augurs well for a continuation

of robust agricultural growth and in maintaining

the momentum we have seen in the growth of

our rural economy. Increasingly agriculture plays

a smaller role in the rural economy with other

activities contributing more. Overall, this will lead

to more stable and higher growth rates in rural

demand with its accompanying knock on impact.

Benign crude oil prices have helped the

Government manage the fiscal deficit. The recent

increase in prices, though have dampened the

mood a bit. Pump prices of gasoline and diesel

have gone up, and despite criticism, remain on

par with the rest of the world. This indicates

that the Government has maintained the policy

of pump pricing in line with global prices and

has not succumbed to the reintroduction of

any subsidy. The recent turmoil with the USA

withdrawing from the Iran accord may reduce

supply but the statements from Saudi Arabia

and Russia committing to maintain supply augur

well for the supply and pricing of this key energy

input. Crude oil production from new sources

like shall remain robust.

The global macro-economic environment has

been stable though some storm clouds loom.

Brexit and continuing political turmoil in Italy

and Spain have again reignited the debate on

the future of the Euro. Rising rates in the US

may dampen emerging market flows. This is

tempered by the fact that Indian remains the

Emerging Market of choice and should attract

more than its share of fund flows.

We saw an opportunity in Wealth Management

Advisory, driven by the rapidly expanding flows

into mutual funds and the rapid growth of this

sector, and effective April 1, 2018, a team of 20+

investment professionals have joined the group

in our wholly owned subsidiary, Prime Research

and Advisory Limited. We are very optimistic for

the prospects for this new business segment. In

this the team services the institutional segment

and, as a bonus, we see opportunities in cross

selling.

As always, we are humbled by the confidence

reposed in us by our customers. They continue

to bless us with repeat business and referrals and

for this we must express our deepest gratitude.

DIVIDEND AND RESERVESThe Board of Directors has not recommended

any Dividend on Equity Shares for the Year under

review. During the Year, no amount from Profit

was transferred to General Reserve.

ISSUE OF EQUITY SHARE WARRANTSThe Paid-up Equity Share Capital of the

Company as at March 31, 2018 stood at

H1,329.94 lacs. During the year under review,

the Company has not issued Equity Share.

The Board of Directors at their Meeting held

on February 15, 2018 and the Members of the

Company at their Extraordinary General Meeting

held on March 20, 2018, has approved the

issue, on a Preferential basis, of upto 70,00,000

Equity Share Warrants. Pursuant to the same,

the Board of Directors at their Meeting held

on April 3, 2018, has allotted 70,00,000 Equity

Share Warrants on a Preferential basis. Each

Equity Share Warrant carries an entitlement to

apply for One Equity Shares of Face Value H5/-

each of the Company, at a price of H49.50 per

Equity Share (“Exercise Price”), in one or more

tranches, within a period of 18 Months from the

date of allotment of Equity Share Warrants. The

Company has received an amount equivalent

to the 25% of the Exercise Price of the Equity

Share arising on the exercise of Options under

the Equity Share Warrants.

MANAGEMENT DISCUSSION AND ANALYSIS REPORTPursuant to the provisions of the Regulation

34 of the SEBI (Listing Obligations and

Disclosure Requirements) Regulations, 2015, the

Management Discussion and Analysis Report

giving a detailed account of the operations and

the state of affairs of the Company is annexed as

Annexure “1” to this Report.


DIRECTORS AND KEY MANAGERIAL PERSONNELDuring the year under review, Mr. S. R. Sharma,

who was earlier appointed as an Independent

Director for a period of Five Years w.e.f. March 1,

2015, has been appointed as Managing Director

of 100% Subsidiary, Primesec Investments

Limited w.e.f. December 7, 2017. In view of the

same, Mr. S. R. Sharma has ceased to be an

Independent Director and he continues to be a

Non-Executive Director for the remainder of his

term, subject to liable to retire by rotation.

Mr. N. Jayakumar, Managing Director, has been

re-designated as Managing Director and Group

CEO w.e.f. May 29, 2018.

Mr. Vineet Suri, who has been associated with the

Company as Director & Head – Corporate Finance

since December 2016, has been appointed as an

Executive Director of the Company for a period

of five years w.e.f. May 29, 2018.

In accordance with the provisions of Section 152

of the Companies Act, 2013 and the Articles of

Association of the Company, Mr. S. R. Sharma,

Director, retires by rotation at the ensuing

Annual General Meeting and being eligible,

offers himself for re-appointment.

Appropriate Resolution for appointment / re-

appointment is being placed before you for your

approval at the ensuing Annual General Meeting.

The information on the particulars of Director

seeking re-appointment, as required under SEBI

(Listing Obligations and Disclosure) Regulations,

2015, is given in the Notice of the Annual General

Meeting, forming part of this Annual Report. The

Board recommends his re-appointment for the

consideration of the Members of the Company

at the ensuing Annual General Meeting.

The Company has received declaration form

all the Independent Directors of the Company

confirming that they meet the criteria of

Independence as prescribed under Section

149(6) of the Companies Act, 2013 and

Regulation 16(b) of the SEBI (Listing Obligations

and Disclosure) Regulations, 2015.

Mr. N. Jayakumar, Managing Director and Group

CEO, Mr. Nikhil Shah, Chief Financial Officer and

Mr. Ajay Shah, Company Secretary are the Key

Managerial Personnel and there is no change in

the same during the Year.

NUMBER OF BOARD MEETINGS CONDUCTED DURING THE YEARDuring the year under review, Six Board Meetings

were conducted on April 6, 2017, July 11, 2017,

October 17, 2017, November 17, 2017, January

23, 2018 and February 15, 2018. The intervening

gap between the Meetings was within the period

prescribed under the Companies Act, 2013

and SEBI (Listing Obligations and Disclosure

Requirements) Regulations, 2015. The Company

has complied with the applicable Secretarial

Standards 1 on Board Meetings, issued by the

Institute of Company Secretaries of India.

COMMITTEES OF THE BOARDThe Board of Directors has constituted the Audit

Committee, Nomination and Remuneration

Committee, Stakeholders’ Relationship

Committee, Corporate Social Responsibility

Committee.

The detailed information about the Committees

including their composition, number of

meetings held and attendance at the meetings

are provided in the Corporate Governance

Report forming part of this Report.

BOARD EVALUATIONAnnual performance evaluation of the Board of

Directors, its Committees and all the Directors

individually have been done in accordance with

the performance evaluation framework adopted

by the Company and a structured questionnaire

was prepared after taking into consideration

the various aspects of the Board’s functioning,

composition of the Board and its Committees,

culture, execution and performance of specific

duties, obligations and governance. The

performance evaluation framework sets out the

performance parameters as well as the process

of the performance evaluation. Pursuant to

the provisions of the Companies Act, 2013, a

separate Meeting of Independent Directors was


held during the year to review (i) performance of

the Non-Independent Directors and the Board of

Directors as a whole (ii) performance of the Board

Committees (iii) performance of the Chairperson

of the Company, taking into account the views of

Executive Directors and Non-Executive Directors

(iv) the assess the quality, quantity and timeliness

of flow of information between the Management

and the Board of Directors that is necessary

for the Board of Directors to effectively and

reasonably perform its duties. The Board of

Directors expressed their satisfaction with the

evaluation process.

POLICY ON DIRECTORS’ APPOINTMENT, REMUNERATION, ETCThe Board of Directors of the Company has

adopted a policy on remuneration of Directors,

Key Managerial Personnel and other employees,

which also lays down the criteria for selection

and appointment of Board Members and Board

diversity. The details of this policy are explained

in the Corporate Governance Report forming

part of this Annual Report and the same is also

available on the website of the Company (www.

primesec.com).

CORPORATE GOVERNANCE AND CODE OF CONDUCTPursuant to Regulation 34(3) read with Schedule

V of the SEBI (Listing Obligations and Disclosures)

Regulations, 2015, a separate report on Corporate

Governance practices followed by the Company

together with the certificate from the Statutory

Auditors, confirming compliance by the Company

of the conditions of Corporate Governance is

annexed as Annexure “2” to this Report.

Pursuant to the provisions of Regulation 17(5)(a)

of the SEBI (Listing Obligations and Disclosures)

Regulations, 2015, your Company has also

laid down a Code of Conduct for its Board

Members and Senior Management Personnel.

All the Directors and the Senior Management

Personnel have affirmed compliance with

the said Code of Conduct. A declaration by

the Managing Director regarding compliance

by Board Members and Senior Management

Personnel with the Code of Conduct for the

year ended March 31, 2018 forms part of the

Report on Corporate Governance.

CONSOLIDATED FINANCIAL STATEMENTThe Audited Consolidated Financial Statements

has been prepared in accordance with the Indian

Accounting Standards (Ind-AS) notified under

Section 133 and other relevant provisions of the

Companies Act, 2013 read with Rule 7 of the

Companies (Accounts) Rules, 2014, as applicable

and shows the financial information of the

Company and its Subsidiaries as a single entity,

after elimination of minority interest, if any. As

required under provisions of the Companies Act,

2013, as applicable, the Audited Consolidated

Financial Statements of the Company and all

its Subsidiaries together with Auditor’s Report

thereon forms part of this Annual Report.

During the period, the Consolidated Revenues

were H2,402.47 lacs as compared to H1,957.65

lacs in the previous period, which comprises

Merchant Banking and Advisory Fees of H2,311.42

lacs, Gain / (Loss) on Sale of Investments,

Derivatives and other transactions of H7.73 lacs,

Income from Dividend, Interest & Other Income

of H83.32 lacs. The Consolidated Net Profit /

(Loss) after Tax & Exceptional Items for the year

under review was H1,430.48 lacs as compared to

H1,341.31 lacs in the previous period.

SUBSIDIARY COMPANIES / JOINT VENTURESPursuant to Section 129(3) of the Companies

Act, 2013 read with the Rule 5 of the Companies

(Accounts) Rules, 2014, a statement containing

the salient features of the Audited Financial

Statements of the Subsidiaries / Associate

Companies for the year ended March 31, 2018

is given in Form AOC-1 as an annexure to the

Consolidated Financial Statements of the

Company forming part of this Annual Report.

The policy for Determining Material Subsidiaries

has been placed on the website of the Company

(www.primesec.com). Separate Audited

Financial Statements of each of the Subsidiaries

are available on the website of the Company

(www.primesec.com) and will be kept open for


inspection by any shareholder of the Company

at the registered office of the Company and

the same will also be made available to the

shareholders seeking such information at any

point of time.

The summary of the state of affairs and

performance of the subsidiaries is given below:

Prime Broking Company (India) Limited

During the year under review, the Hon’ble High

Court at Mumbai passed the order for winding-

up of Subsidiary viz. Prime Broking Company

(India) Limited (“PBCIL”) and accordingly, the

Consolidated Financial Statement for the Year

ended March 31, 2018 does not include Financial

Results of PBCIL. There is no impact of winding-up

of PBCIL on the financial results of the Company,

as PBCIL was not carrying any activities since last

few years and the Company had also written-off

its investments in PBCIL in earlier years.

Primesec Investments Limited

During the year under review, Primesec

Investments Limited (“PIL”), which was involved

in investments activities in the past, has

entered into new segment of financial services

comprising of corporate advisory services

relating to restructuring of corporate debt,

restructuring of corporate entities, especially

cases involving National Company Law Tribunal

(“NCLT”), placement of secondary debt and

equity, etc. During the year under review, PIL

earned revenues of H1,485.17 lacs as compared

to H1,261.67 lacs in the previous year. This

includes Advisory Fees of H1,484.24 lacs, Gain

/ (Loss) on Sale of Investments of H0.93 lacs.

During the year, PIL incurred Net Profit / (Loss)

after Tax and Exceptional Items of H863.72 lacs

as compared to H2,120.57 lacs in the previous

year.

Prime Research & Advisory Limited

During the year under review, Prime Research

& Advisory Limited (“PRAL”) earned revenues

of H1.08 lacs as compared to H Nil in the

previous year. During the year under review,

PRAL incurred Net Profit / (Loss) after Tax of

H207.61 lacs as compared to H (101.38) lacs in

the previous year. The Net Profit / (Loss) is after

an Exceptions Items of H274.61 lacs, which

represents an amount no longer payable and

written-back in the books of PRAL. PRAL is

diversifying into newer segments of financial

services business comprising of value added

intermediation services in wealth management

and investment advisory, assisting banks

and institutional investors in risk assessment,

portfolio analysis and portfolio rebalancing

through execution of specific strategies. PRAL’s

target clients will include corporate treasuries,

fund management companies and family offices

among others. To facilitate entry into these

exciting and rapidly growing segments, PRAL

is in the process of taking on board a highly

experienced, connected and networked team

of twenty five reputed professionals with a

proven track record of several years. The team

currently has an enviable roster of clients and

counter-parties. The new team’s business is

robust and it has a fairly full opportunity pipeline

and substantial current income through fees and

annuities that it will bring to PRAL.

Prime Commodities Broking (India) Limited


(“PCBIL”) was incorporated in 2006 to carry

on Broking and other related activities in the

Commodities Markets. However, PCBIL has not

yet commenced the proposed activity. During

the year under review, PCBIL earned revenues

of H34.51 lacs as compared to H27.57 lacs in the

previous year. During the Year under review,

PCBIL earned a Net Profit after Tax of H11.96 lacs

as compared to H13.07 lacs in the previous year.

The Company has not entered into any Joint

Ventures.

EXTRACT OF THE ANNUAL RETURNThe details forming part of the extract of the

Annual Return in Form MGT-9 as per provisions

of Section 92 of the Companies Act, 2013

and the Rules made thereunder is annexed as

Annexure “3” to this Report.

RELATED PARTY CONTRACTS & ARRANGEMENTSIn accordance with the provisions of the


Companies Act, 2013 and the SEBI (Listing

Obligations and Disclosures) Regulations, 2015,

the Company has formulated a Policy on Related

Party Transactions and a copy of the same is

available on the website of the Company (www.

primesec.com). The policy intends to ensure

that proper reporting, approval and disclosure

processes are in place for all transactions with

related parties and also deals with material

related party transactions.

All related party transactions are placed before

the Audit Committee for necessary review and

approval. Prior omnibus approval of the Audit

Committee is obtained for transactions with

related parties, which are repetitive in nature and

/ or are entered into in the ordinary course of

business and are on an arm’s length basis. None

of the Directors has any pecuniary relationships

or transactions vis-à-vis the Company except

remuneration and sitting fees.

All transactions entered into by the Company

with the related parties during the financial year

were in ordinary course of business and are

on an arm’s length basis. Disclosure pursuant

to the Accounting Standards on related party

transaction has been made in the notes to the

Audited Financial Statements. No material related

party transaction were entered into during the

year by the Company and accordingly, the

disclosure of contracts or arrangements with

related parties in accordance with the provisions

of Section 134(3)(h) of the Companies Act, 2013

in Form AOC-2 is not applicable.

DEPOSITSYour Company has not accepted any Fixed

Deposits under Chapter V of Companies Act,

2013, during this financial year and as such, no

amount on account of principal or interest on

Deposits from public was outstanding as on

March 31, 2018. The Company has no Deposit

which is not in compliance with the provisions of

Chapter V of the Companies Act, 2013 and as the

Companies (Acceptance of Deposit) Rules, 2014.

DIRECTORS’ RESPONSIBILITY STATEMENTPursuant to the provisions of Sections 134(3)

(c) of the Companies Act, 2013, with respect to

the Directors’ Responsibilities Statement, your

Directors confirm that:

a) In the preparation of the Annual Accounts

for the year ended March 31, 2018, the

applicable Accounting Standards read with

the requirements set out under Schedule

III to the Companies Act, 2013, have

been followed and there are no material

departures from the same;

b) They have selected such accounting

policies and applied them consistently and

made judgements and estimates that are

reasonable and prudent so as to give a true

and fair view of the state of affairs of the

Company as at March 31, 2018 and of the

profits of the Company for the year ended

on that date;

c) They have taken proper and sufficient care

for the maintenance of adequate accounting

records in accordance with the provisions of

the Companies Act, 2013 for safeguarding

the assets of the Company and for preventing

and detecting fraud and other irregularities;

d) They have prepared the annual accounts on

a going concern basis;

e) They have laid down internal financial

controls to be followed by the Company

and that such internal financial controls are

adequate and are operating effectively; and

f) They have devised proper systems to

ensure compliance with the provisions of all

applicable laws and that such systems are

adequate and operating effectively.

CORPORATE SOCIAL RESPONSIBILITYPursuant to the provisions of Section 135 of the

Companies Act, 2013 read with Schedule VII of

the Companies Act, 2013 and the Companies

(Corporate Social Responsibility Policy) Rules,

2014, the Company has constituted Corporate

Social Responsibility (“CSR”) Committee,

consisting of Mr. Pradip Dubhashi, Independent

Director, Mr. Anil Dharker, Independent Director

and Mr. N. Jayakumar, Managing Director. The

Company has also formulated CSR Policy and

the same is available on the website of the


Company (www.primesec.com). The report on

CSR activities as required under the Companies

(Corporate Social Responsibility Policy) Rules,

2014 is annexed as Annexure “4” to this Report.

PARTICULARS OF LOANS GIVEN, INVESTMENTS MADE, GUARANTEES GIVEN AND SECURITIES PROVIDEDParticulars of Loans, Guarantees and

Investments made by the Company pursuant to

the provisions of Section 186 of the Companies

Act, 2013 are given in the notes to the Audited

Financial Statements forming part of this Annual

Report.

VIGIL MECHANISM / WHISTLE BLOWER POLICYThe Company has established a Vigil Mechanism

/ Whistle Blower Policy for Directors and

Employees to report genuine concerns or

grievances for redressal, which provides for

adequate safeguards against victimization of

persons who avail of such a mechanism. A copy

of the Whistle Blower Policy is available on the

website of the Company (www.primesec.com).

AUDITORS AND AUDITORS’ REPORTM/s. Gandhi & Associates LLP, Chartered

Accountants (Firm Registration No: 102965W/

W100192), were appointed as Statutory

Auditors, for a term of Four years, commencing

from the Financial Year 2015-16. A certificate

from them has been received, to the effect

that their appointment as Statutory Auditors

of the Company is in accordance with the

applicable provisions of Section 139 and 141

of the Companies Act, 2013 and rules framed

thereunder, as amended from time to time.

Report given by the Auditors on the Audited

Financial Statements of the Company forms

part of this Annual Report. Observations made

in the Auditors’ Report are self-explanatory and

therefore, do not call for any further explanation.

SECRETARIAL AUDIT REPORTPursuant to the provisions of Section 204 of

the Companies Act, 2013 and the Rules made

thereunder, the Board of Directors has appointed

M/s. Pramod Shah & Associates, Company

Secretaries (C.P. No. 5540), to undertake the

Secretarial Audit for the year ended March

31, 2018. The Secretarial Report given by the

Secretarial Auditor is annexed as Annexure “5” to

this Report.

MATERIAL CHANGES AND COMMITMENT, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY OCCURRED BETWEEN THE END OF THE FINANCIAL YEAR TO WHICH THIS FINANCIAL STATEMENTS RELATE AND THE DATE OF THE REPORTExcept as disclosed elsewhere in this Report, no

material changes and commitments affecting

the financial position of the Company occurred

between the end of the Financial Year to which

this Financial Statements relate and the date of

this Report.

EMPLOYEESDisclosures with respect to the remuneration

of Directors and Employees as required under

Section 197(12) of the Companies Act, 2013

and the Rule 5(1) Companies (Appointment and

Remuneration of Managerial Personnel) Rules,

2014 is annexed as Annexure “6” to this Report.

The information on Employees particulars as

required under Section 197(12) of the Companies

Act, 2013 read with Rule 5(2) and 5(3) of the

Companies (Appointment and Remuneration of

Managerial Personnel) Rules, 2014 (as amended)

is annexed as Annexure “7” to this Report. In

terms of Section 136 of the Companies Act,

2013, the Report and Financial Statements are

being sent to the Members and others entitled

thereto, excluding the aforesaid Annexure. The

said information is available for inspection by

the Members at the Registered Office of the

Company as per the details mentioned in notice

of the Annual General Meeting on any working

day of the Company up to the date of the 35th

Annual General Meeting. Any Member interested

in obtaining a copy of the same may write to the

Company Secretary.


For and on behalf of the Board of Directors

Mumbai Pradip Dubhashi N. Jayakumar

May 29, 2018 Chairman Managing Director and Group CEO

None of the Employee of the Company is a

Relative of any Director of the Company.

EMPLOYEE STOCK OPTION SCHEMESThe Company presently has one Employee Stock

Option Schemes viz. Employee Stock Option

Scheme 2009 (ESOS 2009). The Compensation

Committee of the Board of Directors had

granted, to eligible Employees / Directors of the

Company and Subsidiary Companies 1,485,000

options pursuant to ESOS 2009.

The disclosures in accordance with the

provisions of the Section 62(1)(b) of Companies

Act, 2013 read with the Rule 12(9) of the

Companies (Share Capital and Debentures)

Rules, 2014 (as amended from time to time), the

Securities and Exchange Board of India (Share

Based Employee Benefits) Regulations, 2014 are

set out as Annexure “8” to this Report. The shares

arising out of exercise of the Options are allotted

in the name of the respective Employees and

accordingly, the provisions relating to disclosure

of voting rights not exercised directly by the

Employees are not applicable.

PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGOSince the Company is not engaged in any

manufacturing activity, the disclosures as

required under the Companies (Disclosure of

Particulars in the Report of Board of Directors)

Rules, 1988 pertaining to conservation of

energy, etc. are not applicable.

During the period, there were no earnings and

expenditure in foreign exchange.

LISTING & LISTING FEESThe Equity Shares of the Company are listed on

the Bombay Stock Exchange Limited and the

National Stock Exchange of India Limited and

the Listing Fees for the year 2018-19 have been

duly paid.

GENERAL DISCLOSURESYour directors state that during the year under

review:

a) The Business Responsibility Reporting

as required pursuant to the provisions

of Regulation 34(2) of the SEBI (Listing

Obligations and Disclosures) Regulations,

2015 is not applicable to your Company.

b) No Equity Shares with Differential Rights,

as to Dividend, Voting or otherwise, were

issued.

c) No Equity Shares (including Sweat Equity

Shares) were issued to Employees of the

Company under any Scheme.

d) The Company has not resorted to any Buy-

back of its Equity Shares during the Year

under review.

e) Managing Director of the Company has not

received any Remuneration or Commission

from any of its Subsidiaries.

f) No significant or material orders were passed

by the Regulators or Courts or Tribunals,

which impact the Going Concern status and

Company’s operations in future.

ACKNOWLEDGEMENTSThe board wishes to place on record its sincere

appreciation for the hard work put in by the

Company’s Employees at all levels in this difficult

environment. The Board of Directors also wishes

to thank the Company’s Members, Bankers and

all other business associates for their unstinted

support during the year.


Management Discussion & AnalysisAnnexure 1 to Director’s Report

THE CONTINUING MATURING OF OUR CAPITAL MARKETSInvestor interest in our markets remains strong.

Particularly heartening has been the strong

flows into domestic mutual funds. Total assets

under management for the industry is at an all-

time high of around H22 Lakh Crores and the

momentum is sustained in the first few months

of the current year too. Markets remain at near

all- time highs and we have seen a number of

high quality equity issuances. While interest

in the markets will ebb and flow, we remain

confident in its short, medium and long- term

prospects.

INDIA: A PREFERRED INVESTMENT DESTINATIONWe remain a preferred investment destination

with foreign direct investment flows touching

all- time highs. Walmart’s US$ 16 billion

investment in Flipkart underlines the massive

progress we have made. A home-grown

company, exemplifying “Make in India” will now

be taken on to the world stage by the world’s

largest and most profitable retailer. This is a

massive testimonial to the capability of our

young entrepreneurs and this ‘fire’, we are sure

will drive interest in our markets. The massive

growth of digital start-ups, from Swiggy to Ola,

creates a foundation for sustained economic

growth and will create markets and employment

in new uncharted areas that didn’t exist before!

The spin off impact on other sectors is immense.

Warehousing, trucking, all are now high growth

sunrise sectors for the economy

THE ECONOMYThe economy has been on a sustained path

of recovery as the process of normalization,

post the 2008 crisis, nears completion with

the stimulus having ended and a much-needed

fiscal balance is restored. The tough tasks near

completion and the Government has guided the

economy onto a steep takeoff trajectory.

Infrastructure

There has been a sustained focus on the build

out of infrastructure. Be it Civil Aviation, Railways

or Roads, the Government has made huge

strides.

In Aviation, the connection of several hitherto

unconnected cities has brought remote regions

closer to the major economic centers and will

catalyze growth there. Air traffic volumes have

seen around 20% growth and flights are all going

full.

The Railways are leading the effort to develop

metro systems in multiple cities and their roll out

will be a key economic enabler as people with

skills are better matched to jobs. The commute

experience is far superior and will propel its

usage. The progress in the build out of roads

has been nothing but stupendous. The Bullet

train project will be a major step forward for Rail

technology and for commuting in one of the

densest traffic corridors in the country.

It is in roads that we have made wonderful

progress. The pace of completion of roads has

accelerated. Riding on this and the impact of an

overloading ban, as well as last year’s low base,

commercial vehicle sales expanded in the high

double digits in April. Sales volumes of the top

four manufacturers rose 78 per cent over the

year-ago period to 67,548 vehicles.

Rural Electrification

This has been the bright spot in the development

of infrastructure. As remote villages get lit up, the

opportunities expand in our villages. The ability


to perform tasks before sunrise and after sunset,

expands the time available and improves rural

productivity. Moreover, the ability this creates

for the villages to remain connected improves

information flow and drives greater choice and

efficiency

Rural Economy

The rural economy has performed well. Almost

all businesses selling into this segment from

tractors, wo had their highest-ever sales in 2017-

18. At 7.11 lakh units, sales are significantly higher

than the 5.83 lakh units recorded in 2016-17.

The 22 per cent rise exceeded expectations .

Growth in consumption in rural India outpaced

that of urban areas by a wide margin—the first

time in five years. This was driven by better rains

and lower rates of the goods and services tax

(GST). Rural consumption grew at 9.7% for the

financial year 2018, while that of urban markets

was at 8.6%, in comparison. To give sustained

support to agriculture, government has decided

to keep MSP for all unannounced Kharif crops

at least one and half times of their production

cost after declaring the same for the majority of

Rabi crops. This will give additional support to

the rural economy.

The Global Economy

The US Fed began normalizing policy and has

built up expectations of a series of rate increases.

At the same time, the new Trump administration

is focused on the US’s terms of trade with other

countries, including tariffs. This has created

stress in the export sector. The US policy stance

has meant that there has been pressure on the

Indian Rupee and the risk of further weakening

is high. Oil prices have been moving up as the

excess supply has worked itself off and crude

touches $ 80 per barrel. This has a knock- on

effect on the price of energy for our economy,

as it impacts input prices for a number of critical

products, fertilisers, plastics etc.

INDUSTRY REVIEWA. Industry Structure & Developments

The year gone by has been eventful. The

Reserve Bank of India and the Government

brought focused attention to the massive

problem of NPAs. The initial results are

heartening. As we write this report, the first of

the NPA cases that defied resolution for quite

a while, Bhushan Steel has been taken over

by Tata Steel. Electrosteel is on the verge of

being taken over by Vedanta. The recovery

rates for banks has been higher than was

anticipated and as the Insolvency Process

goes through its initial teething issues, we

now have a robust framework for recovery

of loans and above all the regeneration of

assets. The focus of the IBC and the process

inherent in it has prompted many defaulting

corporates to get their affairs in order.

As growth rates pick up and capital

formation in the private sector is rekindled,

opportunities for fund raising and mergers

and acquisitions will grow.

We see a range of opportunities for mandates

that our strengths are well suited for.

We took the step of expanding our

product offerings with the addition “Wealth

Management & Investment Advisory”

services for institutions and high net-worth

individuals, family offices and trusts. A team

of around 20 professionals has come on

board. This business is being run in our

wholly owned subsidiary, Prime Research &

Advisory Limited. This new business stream

will add to our revenues and profits.

B. Opportunities & Threats

As the economy stabilizes onto a growth

path, after the execution of key structural

changes, we see increasing activity among

customers we service. We are handling a

number of mandates for fund raising as

well as restructuring of balance sheets. Deal

flow remains robust and we have a healthy

pipeline of mandates. The new business

of wealth management advisory will add

significantly to revenues and profits.

Banks remain under stress with several of

them having been placed under Prompt


Corrective Action (PCA) by the RBI. This

freezes new lending by them and even as

the NPA problem begins to get resolved, it

is possible that recovery could get delayed

due to this constraint. Yet, in this there is

an opportunity for solutions and we look to

capitalize on this.

The global economy has seen good growth

rates and this could be ending as the Euro

area enters another period of uncertainty.

With continuing job growth in the US and

unemployment there falling to 18-year lows,

interest rates could be on the rise. Cyclical

factors could turn down and threaten

growth in our economy through a knock

on effect via increasing interest rates, muted

capital flows and tepid export growth.

C. Segment-wise or Product-wise Performance

The Company operates only in the advisory

business. Its subsidiary has been in the

business of brokerage for institutional and

high net worth clients, an activity which has

now been shut down.

D. Outlook

Deal flow has been excellent and we continue

to add execution capacity opportunistically.

We continue to provide innovative solutions

to complex problems and referrals remain a

key source of new business as well as repeat

mandates.

E. Risks & Concerns

We have reduced debt on the balance sheet

to nearly zero and as we have articulated

in the past, we do not expect to leverage

the balance sheet. Our focus will be on

generating income from our advisory

business and the only use of capital will be to

setup office and related infrastructure.

F. Internal Control Systems & Their Adequacy

Your Company’s Internal Control System

and procedures were consciously reviewed

during the year and systems and procedures

were corrected wherever found to be

inadequate to the Company’s size, the

nature of its business and the endemic

business environment. The internal control

systems lay down the policies, authorization

and approval procedures.

The adequacy of the internal control systems

has been reported by the auditors under the

Companies (Auditor’s Report) Order, 2003.

G. Discussion on Financial Performance

The Consolidated Revenues of the Company

were H2,402.47 lacs for the financial year

under review as against previous year

H1,957.65 lacs. Consolidated Profit after Tax

and Exceptional Items was at H1,430.48 lacs

as against previous year H1,341.31 lacs.

The Company has been able to restructure

its debt substantially and has reached very

advantageous settlements with its creditors.

We have been able to reduce debt to very

manageable levels and remain on track to be

debt free in the next 12-18 months.

H. Material Development in Human Resources

/ Industrial Relations Front, Including

Number of People Employed

We continue to grow our pipeline of

transactions in the corporate advisory

business and will add people as needed.

Fortunately, with several firms closing shop,

there is talent in the market available to be

hired as the business volumes grow.

CAUTIONARY STATEMENTStatements in this Management Discussion &

Analysis describing the Company’s objectives,

projections, estimates, expectations or

predictions may be “forward looking statements”

within the meaning of applicable securities

laws and regulations. Actual results could differ

materially from those expressed or implied.

Important factors that could make a difference

to the Company’s operations include economic

developments in the country and improvement

in the state of capital markets, changes in the

Government regulations, tax laws and other

status and other incidental factors.


MANDATORY REQUIREMENTS1. Company’s Philosophy on Corporate Governance The Company’s philosophy on Corporate Governance is aimed at ensuring that the objectives

of the Company are well defined along with timely measurement and monitoring of the

performance against those objectives. It envisages attainment of a high level of transparency

& accountability in the functioning of the Company and helps the Management in the efficient

conduct of the Company’s affairs and in protecting the interest of various participants like

Shareholders, Employees, Lenders, Clients, etc and at the same time places due emphasis on

compliance of various statutory laws.

2. Board of Directors Composition and Category

The Board of Directors (“the Board”) of the Company currently comprises of an optimum

combination of Executive and Non-Executive Directors, in compliance of the requirement of

the provisions of Regulation 17(1)(a) of the SEBI (Listing Obligations and Disclosure Requirement)

Regulation, 2015.

As of the Year ended March 31, 2018, the Board of Directors had Five Directors, comprising of

Three Non-Executive & Independent Directors, One Non-Executive and One Executive Director.

The Chairman of the Board is a Non-Executive and Independent Director.

There is no relationship between the Directors inter-se.

The Composition of the Board, Directorship / Committee position in other companies as on

March 31, 2018, number of meetings held and attended during the Financial Year 2017-18 are as

follows:

Report on Corporate Governance[Pursuant to regulation 34(3) read with Part C of Schedule V the SEBI

(Listing Obligations and Disclosure Requirements) Regulations, 2015]

Name Category (#)

Board Meetings during 2016-17

Attendance at last Annual

General Meeting (“AGM”) held on September 25,

2017

Other Director-ships in India (*)

Committee positions in India (**)

Held Attended Member Chairman

Ms. Alpana Parida

NED-I 6 6 Yes 5 1 Nil

Mr. Anil Dharker

NED-I 6 6 Yes 1 Nil Nil

Mr. N. Jayakumar

MD 6 6 Yes 4 Nil Nil

Mr. Pradip Dubhashi

NED-I 6 6 Yes 3 1 Nil

Mr. S. R. Sharma@

NED 6 6 Yes 2 Nil Nil

# NED-I means Non-Executive & Independent Director, NED means Non-Executive Director, MD

means Managing Director.

* Excludes Alternate Directorships, Directorships in Private / Foreign Companies and interest in

Firms / other bodies.

Annexure 2 to Director’s Report


** Includes Memberships of only Audit and Stakeholders Relationship Committee of Public

Limited Companies other than Prime Securities Limited.

@ Mr. S. R. Sharma, who was an Independent Director, was appointed as Managing Director

of Wholly-owned Subsidiary, Primesec Investments Limited, w.e.f. December 7, 2017 and

accordingly, he ceased to be an Independent Director w.e.f. December 7, 2017 and continues

as Non-Executive Director on the Board of Directors.

Notes:

(a) None of the Directors of the Company hold Directorships in more than 7 listed companies,

in compliance of the requirement of the provision of Regulation 25(1) of the SEBI (Listing

Obligations and Disclosure Requirement) Regulation, 2015. .

(b) None of the Directors on the Board is a Member of more than 10 Committees and Chairman of

more than 5 Committees across all the companies in which they are Director, in compliance

of the requirement of the provision of Regulation 26(1) of the SEBI (Listing Obligations and

Disclosure Requirement) Regulation, 2015.

(c) All the Directors have furnished the necessary disclosure regarding their Directorship and

Committee Membership.

Board Meetings

During the Financial Year 2017-18, 6 Board Meetings were held on April 6, 2017, July 11, 2017,

October 17, 2017, November 17, 2017, January 23, 2018 and February 15, 2018.

The gap between two Board Meetings did not exceed 120 days. Further the Company has adopted

and adhered to the Secretarial Standards prescribed by the Institute of Company Secretaries of

India (“ICSI”) as approved by the Central Government.

Agenda papers containing all necessary information / documents are made available to the Board

/ Committees in advance to enable the Board / Committees to discharge its responsibilities

effectively and take informed decisions. Where it is not practicable to attach or send the

relevant information as a part of Agenda Papers, the same are tabled at the meeting or / and the

presentations are made by the concerned managers to the Board, subject to compliance with

legal requirements. Considerable time is spent by the Directors on discussions and deliberations

at the Board / Committee Meetings.

The information as specified in Schedule II of LODR is regularly made available to the Board,

whenever applicable, for discussion and consideration.

Number of Shares and Convertible Instruments held by Non-Executive Directors:

None of the Non-Executive Director is holding any Equity Shares or Convertible Instruments of

the Company.

Familiarisation Programme for Directors

At the time of appointing a Director, a formal letter of appointment is given, which inter alia

explains the role, function, duties and responsibilities expected of him / her as a Director. The

Director is also explained in detail the compliance required from him / her under the applicable

acts, rules and regulations and affirmation is obtained. Managing Director also interacts with the

Independent Directors regularly to familiarise them with the Company’s operations. Also, on

an ongoing basis as a part of Agenda of Board and Committee Meetings, the Company makes

detailed presentation to the Directors about the operations of the Company and its subsidiaries.


The details of the familiarisation programme for Directors is available on the website of the

Company (www.primesec.com)

3. Committees of Directors a) Audit Committee

Composition & Meetings

The Audit Committee, which was originally constituted on November 5, 1995, is a qualified

and independent committee, consists of the Members who are financially literate and having

accounting and related financial management expertise. All the Members possess knowledge

of corporate finance, accounts and corporate laws.

The Audit Committee presently comprises of 4 Members, of which Three Members including

the Chairman are Non-Executive and Independent Directors and One Member is Non-

Executive Director.

During the Financial Year 2017-18, the Members met 4 times on April 6, 2017, July 11, 2017,

October 17, 2017 and January 23, 2018. The details of composition and attendance of each

Member at the Meeting is given below:

The Committee invites the Head of the Finance Department, the Managing Director of the

Company, the Internal & Statutory Auditors to participate in the meeting. The Company

Secretary acts as the Secretary to the Meeting. The Chairman of the Committee was present

at the last Annual General Meeting held on September 25, 2017.

Terms of Reference

The Audit Committee has been given the powers to deal with matters specified under

Regulation 18 of the SEBI (Listing Obligations and Disclosure Requirement) Regulation, 2015

as well as under section 177 of the Companies Act, 2013.

The terms of reference of the Audit Committee are briefly described below:

a) Overseeing the Company’s financial reporting process and the disclosure of its financial

information;

b) Recommending to the Board, the appointment / re-appointment of Statutory Auditors,

fixation of their remuneration and reviewing and monitoring their independence /

performance;

c) Approving the payment to Statutory Auditors for any other services rendered by them;

d) Reviewing, with the management, the annual / quarterly financial statements and auditor’s

report thereon before submission to the board for approval;

e) Reviewing, with the management, the statement of uses / application of funds raised

through an issue / funds utilized for purposes other than those stated in the offer document,

Name Category (#) Designation No. of Meetings Attended

Held Attended

Ms. Alpana Parida NED-I Member 4 4

Mr. Anil Dharker NED-I Member 4 4

Mr. Pradip Dubhashi NED-I Chairman 4 4

Mr. S. R. Sharma NED Member 4 4

# NED-I means Non-Executive & Independent Director and NED means Non-Executive

Director.


the report of the agency monitoring the utilisation of proceeds and recommending the

board to take up necessary steps.

f) Approving or any subsequent modification of transactions of the Company with Related

Parties;

g) Scrutiny of Inter-Corporate Loans and Investments;

h) Reviewing guidelines for investing surplus funds of the Company;

i) Reviewing Investment proposal before submission to the Board;

j) To review proposal for mergers, demergers, acquisitions, carve-outs, sale, transfer of

business / real estate and its valuation report and fairness opinion, if any, thereof.

k) Valuation of Undertakings or Assets of the Company;

l) Evaluating internal financial controls and risk management systems;

m) Reviewing, with the management, performance of Statutory and Internal Auditors,

adequacy of the internal control systems;

n) Reviewing the adequacy of Internal Audit function, if any, including the structure of the

Internal Audit department, staffing and frequency of Internal Audit and the performance of

Internal Auditors;

o) Discussing with Internal Auditors of any significant findings and follow up there on;

p) Reviewing the findings of any internal investigations by the Internal Auditors into matters

where there is suspected fraud or irregularity or a failure of internal control systems of a

material nature and reporting the matter to the board;

q) Discussing with Statutory Auditors the nature and scope of audit before the audit

commences as well as post-audit discussion to ascertain any area of concern;

r) Looking into the reasons for substantial defaults in the payment to the depositors,

debenture holders, shareholders (in case of non-payment of declared dividends) and

creditors, if any;

s) Reviewing the functioning of the Whistle Blower mechanism;

t) Approval of appointment of CFO after assessing the qualifications, experience and

background of the candidate;

u) To appoint valuers for the valuation of any property, stocks, shares, debentures, securities

or goodwill or any other Assets or net worth of a Company or liability of the Company

under the provision of the Companies Act, 2013;

v) To ensure proper system of storage, retrieval, display, or printout of the electronic records;

w) Such other functions as is mentioned in the terms of reference of the Audit Committee.

Internal Auditors

The Company has appointed M/s. K. V. S. & Company, Chartered Accountants, as Internal

Auditors of the Company to review the Internal Control Systems. The Report of the Internal

Auditor along with their suggestions is submitted on a quarterly basis before the Audit

Committee for its consideration.


b) Nomination and Remuneration Committee


The Nomination and Remuneration Committee presently comprises 3 Members and all

Members of the Nomination and Remuneration Committee including the Chairman are Non-

Executive and Independent Directors.

During the Financial Year 2017-18, the Members met once on July 11, 2017. The details of

composition and attendance of each Member at the Meeting is given below:

The Company Secretary acts as the Secretary to the Meeting. The Chairman of the Committee

was present at the last Annual General Meeting held on September 25, 2017.

Terms of Reference

The Board has constituted a Remuneration Committee with effect from March 21, 2002 to

determine the Company’s policy on remuneration packages of Executive & Non-Executive

Directors and for considering any revision in their remuneration packages. Subsequently, the

same was reconstituted as “Nomination and Remuneration Committee”.

The broad terms of reference of the Nomination and Remuneration Committee, as approved

by the Board, are in compliance with Section 178 of the Companies Act, 2013 and Regulation

19 of the Listing Regulations, which are as follows:

a) Formulation of the criteria for determining qualifications, positive attributes and

independence of a Director and recommend to the Board a policy, relating to the

remuneration of the Directors, Key Managerial Personnel and other Employees;

b) Formulation of criteria for Evaluation of Independent Directors and the Board;

c) Devising a policy on Board diversity;

d) Identifying persons who are qualified to become Directors and who may be appointed

in Senior Management in accordance with the criteria laid down, and recommend to the

Board their appointment and removal;

e) Recommending extending or continuing the term of appointment of the independent

director, on the basis of the report of performance evaluation of independent directors.

Remuneration Policy

The Remuneration Policy of the Company if performance driven and is structured to

motivate Employees, recognize their merits & achievement and promote excellence in


Held Attended

Ms. Alpana Parida * NED-I Member 1 Nil

Mr. Anil Dharker NED-I Chairman 1 1

Mr. Pradip Dubhashi NED-I Member 1 1

Mr. S. R. Sharma * NED Member 1 1

* Ms. Alpana Parida was inducted as Member of Nomination and Remuneration Committee

w.e.f. January 23, 2018 and Mr. S. R. Sharma ceased to be the Member Nomination and

Remuneration Committee w.e.f. January 23, 2018


Director.


their performance. The Remuneration Policy of Company is displayed on the website of the

Company (www.primesec.com)

a) The appointment and remuneration of Executive Directors including Managing Director

and Whole-time Director is governed by the recommendation of the Nomination and

Remuneration Committee, Resolutions passed by the Board of Directors and Shareholders

of the Company. Payment of remuneration to Executive Directors is governed by the

respective Agreements executed between them and the Company. The remuneration

package of Managing Director and Whole-time Director comprises of salary, perquisites

and allowances, and contributions to Provident and other Retirement Benefit Funds as

approved by the Shareholders at the General Meetings. Annual increments are linked to

performance and are decided by the Nomination and Remuneration and recommended

to the Board for approval thereof.

b) Non-Executive & Independent Directors are paid Sitting Fees for attending Board and

Committee Meetings. Non-Executive & Independent Directors are also entitled to receive

Commission within the ceiling of 1% per annum of the Net Profits of the Company

(computed in accordance with the provisions of Section 198 of the Companies Act, 2013

and the Rules framed thereunder from time to time), as approved by the Shareholders of

the Company at their Annual General Meeting held on September 19, 2016.

The remuneration policy is directed towards rewarding performance, based on review of

achievements. It is aimed at attracting and retaining high caliber talent. The Remuneration

Policy is displayed on the Company’s website (www.primesec.com).

Details of Remuneration paid to all the Directors

Presently, Mr. N. Jayakumar, along with persons acting in concert with him, is holding

50,03,569 Equity Shares of the Company representing 18.87% of the total Shareholding of

the Company. Mr. Vineet Suri is holding 16,043 Equity Shares representing 0.06% of the total

shareholding of the Company. Mr. Anil Dharker is holding 27,000 Equity Shares representing

0.10% of the total shareholding of the Company. None of the other Directors of the Company

holds any Equity Shares in the Company.

Non-Executive and Independent Directors are not entitled to receive Stock Options under

Employee Stock Option Scheme.

Performance Evaluation

Pursuant to the provisions of the Companies Act, 2013 and regulation 17 of the SEBI (Listing

Obligations and Disclosure Requirement) Regulation, 2015, the Board has carried out

the annual evaluation of its own performance, its committees and Independent Directors

Name Fixed Salary Commission Sitting Fees Total

Ms. Alpana Parida Nil Nil 11,10,000 11,10,000

Mr. Anil Dharker Nil Nil 11,30,000 11,30,000

Mr. N. Jayakumar * 1,33,82,672 Nil Nil 1,33,82,672

Mr. Pradip Dubhashi Nil Nil 11,50,000 11,50,000

Mr. S. R. Sharma Nil Nil 9,40,000 9,40,000

* The Contract with the Managing Director and Whole-time Directors are for a period of 5 years

or the normal retirement date, whichever is earlier. The appointment of Managing Director

and Whole-time Director is terminable by giving Three Month’s notice of either party.


individually. A structured questionnaire was prepared after circulating the draft forms, covering

various aspects of the Board’s functioning such as adequacy of composition of the Board and

its committees, Board culture, execution and performance of specific duties, obligations and

governance. The performance evaluation of the Managing Director was carried out by the

Independent Directors.

c) Stakeholders Relationship Committee


The Stakeholders Relationship Committee presently comprises 3 Members, out of which Two

Members including the Chairman are Non-Executive and Independent Directors and One

Member is Non-Executive Director.

During the Financial Year 2017-18, the Members met 4 times on April 6, 2017, July 11, 2017,

October 17, 2017 and January 23, 2018. The details of composition and attendance of each

Member at the Meeting is given below:



Terms of Reference

The Board of Directors had constituted a Share Transfer Committee to approve transfer of

shares and related matters. In line with the recommendations of the Code of Corporate

Governance, the Board has re-designated the Committee as “Stakeholders Relationship

Committee” and vested the Committee with further powers to monitor and review investors’

grievances. The Committee, apart from approving share transfers, transmissions, etc and

other related matters, also looks into the redressal of shareholder complaints like non-transfer

of shares, non-receipt of annual reports etc.

The powers to approve transfer of shares and redress shareholder complaints have been

designated to the Managing Director or the Company Secretary. Such transfer of shares

and shareholder complaints which cannot be settled by the Whole-Time Director and the

Company Secretary are placed before the Stakeholders Relationship Committee for their


Held Attended

Ms. Alpana Parida * NED-I Chairman 4 4

Mr. Anil Dharker @ NED-I Member 4 3

Mr. Pradip Dubhashi @ NED-I Member 4 1

Mr. S. R. Sharma * NED Chairman 4 4

* Ms. Alpana Parida was appointed as Chairperson of Stakeholders Relationship Committee

w.e.f. January 23, 2018 in place of Mr. S. R. Sharma, who ceased to be the Chairman of

the Stakeholders Relationship Committee w.e.f. January 23, 2018 and continues as the

Member.

@ Mr. Pradip Dubhashi was inducted as Member of Stakeholder Relationship Committee w.e.f.

January 23, 2018 and Mr. Anil Dharker ceased to be the Member Stakeholder Relationship

Committee w.e.f. January 23, 2018


Director.


decision. The approval of share transfers is normally done on a weekly basis so that the

Company is able to return share certificates, duly transferred, within fifteen days.

Details of share transfer / transmission and summary of shareholder queries / complaints are

placed at the Meeting of members from time to time.

Compliance Officer

The Board has designated Mr. Ajay Shah, Vice President – Legal and Company Secretary as the

Compliance Officer.

Summary of Shareholders queries received and replied during the year:



d) Corporate Social Responsibilities Committee


The Corporate Social Responsibilities Committee presently comprises 3 Members, out of

which two Members including the Chairman are Non-Executive and Independent Directors

and one Member is Executive Director.

During the Financial Year 2017-18, the Members met once on January 23, 2018. The details of

composition and attendance of each Member at the Meeting is given below:


Held Attended

Ms. Alpana Parida * NED-I Member 1 Nil

Mr. Anil Dharker * NED-I Member 1 1

Mr. Pradip Dubhashi NED-I Chairman 1 1

Mr. N. Jayakumar ED Member 1 1

* Mr. Anil Dharker was inducted as Member of Corporate Social Responsibilities Committee

w.e.f. January 23, 2018 and Ms. Aplana Parida ceased to be the Member Corporate Social

Responsibilities Committee w.e.f. January 23, 2018.

# NED-I means Non-Executive & Independent Director, NED means Non-Executive Director

and ED means Executive Director.

Particulars Queries / Complaints

received

Queries / Complaints Replied

to

Transfer Related 112 112

Dividend Related 9 9

Change of Address 45 45

Demat / Remat 29 29

Correction of Data 15 15

Confirmation of Details 21 21

Mandate 10 10

Transmission 35 35

Miscellaneous 6 6

Total 282 282


Terms of Reference

The Board of Directors has constituted a Corporate Social Responsibilities Committee as

required under Section 135 of the Companies Act, 2013 and the Rules made thereunder,

as amended from time to time. The Committee is responsible for recommending to the

Board the Corporate Social Responsibilities Policy (“CSR Policy”) and the Corporate Social

Responsibilities initiatives and it also monitors implementation of the activities undertaken as

per the CSR Policy.

The Company has formulated CSR Policy, which is uploaded on the website of the Company

(www.primesec.com).

e) Risk Management Committee

The Board of Directors had constituted a Risk Management Committee as required under

Clause 49 of the Listing Agreement entered into with the Stock Exchanges. The Committee

is responsible for framing, implementing and monitoring the risk management plan for the

Company. The Risk Management Committee presently comprises three members:

a) Mr. S. R. Sharma – Chairman & Non-Executive Director

b) Mr. Anil Dharker – Member, Independent & Non-Executive Director

c) Mr. N. Jayakumar - Member, Managing Director

The Company Secretary acts as the Secretary to the Committee.

4. Meeting of Independent Directors The Independent Directors on the Board of Directors of Company met once on January 23, 2018

inter alia for the following:

a) Review the performance of the Non-Independent Director and the Board of Directors as a

whole;

b) Review the performance of the Chairperson of the Company, taking into account the views

of the Executive Directors and Non-Executive Directors;

c) Assess the quality, quantity and timeliness of flow of information between the Management

of the Company and the Board of Directors that is necessary for the Board of Directors to

effectively and reasonably perform their duties.

5. General Body Meetings (a) Location and Time, where the last Three Annual General Meetings were held:

Financial year Date Location of the meeting Time

2016-2017 September 25, 2017 Victoria Memorial School for the

Blind, Mumbai

10.00 a.m.

2015-2016 September 19, 2016 Victoria Memorial School for the

Blind, Mumbai

10.00 a.m.

2013-2015 # September 21, 2015 Victoria Memorial School for the

Blind, Mumbai

10.00 a.m.

# Pursuant to the approval of the Registrar of Companies, the Financial Year ended Septem-

ber 30, 2014 was extended by a period of Six Months upto March 31, 2015 (consisting of

18 months from October 1, 2013 to March 31, 2015) and in view of the same, the approval

of the Registrar of Companies was also obtained to extend the date for holding Annual

General Meeting upto September 23, 2015.


(b) Whether any Special Resolutions passed in the previous Three Annual General Meetings:

Special Resolutions were passed by the Shareholders at the 34th Annual General Meeting of

the Company for (i) Remuneration to Mr. N. Jayakumar as Managing Director.

Special Resolutions were passed by the Shareholders at the 33rd Annual General Meeting of

the Company for (i) Re-appointment of Mr. N. Jayakumar as Managing Director; (ii) Alteration

of Articles of Association; (iii) Place of Keeping Records at the place other than Registered

Office; (iv) Payment of Commission to Non-Executive Directors and (v) Service of documents

to Member through a particular mode.

Special Resolutions were passed by the Shareholders at the 32nd Annual General Meeting of

the Company for (i) Borrowing Limits of the Company and (ii) Increase in limits of Investments

in other Bodies Corporate by the Company.

All the resolutions, including Special Resolutions, if any, set out in the respective Notices were

passed by the shareholders with requisite majority.

(c) Whether any Special Resolution passed last year through Postal Ballot and the person who

conducted the Postal Ballot exercise:

During the year under review, no Special Resolutions were passed through the Postal Ballot.

(d) Whether any Special Resolution is proposed to be conducted through Postal Ballot and

procedure for Postal Ballot

No Special Resolutions are proposed to be passed through the Postal Ballot and any Special

Resolutions proposed to be passed through Postal Ballot in the Current Year will be done in

accordance with the provisions of the prescribed law.

6. Disclosures (a) Materially significant Related Party Transactions:

There are no materially significant Related Party Transactions entered into during the Financial

Year by the Company with its Directors or Management, their Subsidiaries or Relatives that

may have a potential conflict with the interests of the Company at large. All Related Party

Transactions are at arm’s length and in the ordinary course of business. Transactions with

the Related Parties are disclosed in notes to the Audited Financial Statements forming part

of this Annual Report. The Company has formulated a Policy of dealing with Related Party

Transactions, which is available on the website of the Company (www.primesec.com).

(b) Material Subsidiary:

The Company has formulated a policy for determining Material Subsidiaries, which is available

on the website of the Company (www.primesec.com).

(c) Penalties, strictures for non-compliance:

During the last Three Years, there were no penalties, strictures imposed on the Company, by

either the Stock Exchanges or SEBI or any other statutory authorities for non-compliance of

any matter related to the Capital Markets.

(d) Whistle Blower Policy:

The Company has established a Vigil Mechanism (Whistle Blower Policy) for Directors and

Employees to report genuine concerns, which provides for adequate safeguards against

victimization of persons who avails such mechanism. A copy of the Whistle Blower Policy

is available on the website of the Company (www.primesec.com). No personnel of the

Company have been denied access to the Audit Committee.


(e) Code of Conduct for Prohibition of Insider Trading:

In accordance with the Securities and Exchange Board of India (Prohibition of Insider Trading)

Regulations, 2015, the Company has, inter-alia, adopted a Code of Conduct for Prohibition of

Insider Trading duly approved by the Board of Directors of the Company and the Company

Secretary has been appointed as the Compliance Officer for the purpose of ensuring

compliance with the Code of Conduct.

(f) Compliance with mandatory and non-mandatory requirements:

The Company has complied with all the mandatory requirements of this clause except as

stated otherwise in this report. The extent of adoption of non-mandatory requirements has

been stated separately in this report.

7. Code of Conduct The Board of Directors has adopted the Code of Conduct for all Board Members and Senior

Management of the Company. The said Code of Conduct has been communicated to all Board

Members and Senior Management and they have confirmed the annual compliance with the

Code of Conduct. A declaration to that extent signed by Managing Director forms part of this

Annual Report of the Company. The Code of Conduct has also been displayed on the website of

the Company (www.primesec.com).

8. Means of Communication 1. The Board of Directors of the Company approves and takes on record the Quarterly, Half-

yearly and Yearly Financial Results in accordance with the provisions of Regulation 33 of the

SEBI (Listing Obligations and Disclosure Requirement) Regulation, 2015.

2. The Quarterly, Half-yearly and Yearly Financial Results of the Company, as approved by the

Board of Directors of the Company, are communicated to all the Stock Exchanges, where the

shares of the Company are listed and published in the Mumbai edition of Free Press Journal &

Navsakti within the stipulated time. The same are not sent individually to each Shareholder.

3. The Company’s Financial Results and other official news release are displayed on the

Company’s website (www.primesec.com).

4. At present, no formal presentations are made to analysts.

9. General Shareholder Information

• AGM:Date,TimeandVenue Monday, September 24, 2018 at 2.00 p.m. at Victoria

Memorial School for the Blind, Tardeo Road, Opp. Film

Centre, Mumbai 400034

• FinancialCalendar Financial Year April 1, 2018 to March 31, 2019

i) First Quarter ending June 30, 2018 on or before

August 14, 2018

ii) Second Quarter & Half-year ending September 30,

2018 on or before November 14, 2018

iii) Third Quarter & Nine Months ended December 31,

2018 on or before February 14, 2019

iv) Fourth Quarter and Year ended March 31, 2019

during April 2019 to May 2019.

•DateofBookClosure Wednesday, September 19, 2018 to Monday, September

24, 2018 (both days inclusive)


•Dividendpaymentdate N.A.

• ListingonStockExchanges The Bombay Stock Exchange Limited (“BSE”) and The

National Stock Exchange of India (NSE). The Company has

paid the Listing Fees for the Financial Year 2018-2019

• StockCode–Physical BSE: 500337 / NSE: PRIMESECU

•DematISINnumberforNSDL

and CDSL

INE032B01021

•CIN L67120MH1982PLC026724

•Marketpricedata:high,low

during each month in last

financial year

As per Annexure “I”

• Performanceincomparisonto

broad-based indices such as

BSE sensex, CRISIL Index, etc.

As per Annexure “II”

•RegistrarandTransferAgent Link Intime India Private Limited

C-101, 247 Park, L.B.S. Marg, Vikhroli (West),

Mumbai 400083,

Tel: +91-22- 49186270, Fax: +91-22- 49186060,

Email: [email protected]

• ShareTransferSystem The Company Secretary or the Managing Director of the

Company are authorised to approve the transfer of share

and the same are generally registered / confirmed within

15 days of receipt, provided the documents are clear in all

aspects. The said transfers are then noted at the subsequent

stakeholder’s relationship committee meeting.

•DistributionofShareholding As per Annexure “III”

• ShareholdingPattern As per Annexure “IV”

• Top10Shareholders As per Annexure “V”

•DematerialisationofSharesand

liquidity

94.87% of the total shareholding has been dematerialised

as on March 31, 2018

•OutstandingGDRs/ADRs/

Warrants or any convertible

instruments, conversion date

and likely impact of equity

None

• PlantLocation Not Applicable

• AddressforCorrespondence Shareholders correspondence should be addressed to

the Registrar and Share Transfer Agents of the Company,

M/s. Link Intime India Private Limited, C-101, 247 Park,

L.B.S. Marg, Vikhroli (West), Mumbai 400083, Tel: +91-

22- 49186000, Fax: +91-22- 49186060. The Company has

designated an exclusive e-mail id: rnt.helpdesk@linkintime.

co.in, for redressal of investor complaints / grievances.

Shareholders holding shares in the electronic form should

address all their correspondence to their respective

depository participants.


NON-MANDATORY REQUIREMENTS

1. The Board

The Company has a Non-Executive Chairman. The Chairman is not entitled to maintain an

office at the Company’s expenses. However, the Company reimburses expenses, if any,

incurred by him in the performance of his duties.

2. Shareholders’ Rights

The Quarterly and Half-yearly Results are published in the newspapers in terms of the provisions

of Regulation 47 of the SEBI (Listing Obligations and Disclosure Requirement) Regulation,

2015 and are also available on the website of the Company (www.primesec.com) and the

Company is not sending the Quarterly and Half-yearly Results to Individual Shareholder.

3. Audit Qualification

Modified and Unmodified Opinions expressed by the Statutory Auditors in their Report are

self-explanatory and therefore do not call for any further explanation.

4. Separate post of Chairman and CEO

The posts of Chairman and Managing Director are separate.

5. Reporting of Internal Auditor

The Company has appointed Internal Auditor pursuant to the provisions of Section 138 of the

Companies Act, 2013 read with the Companies (Accounts) Rules, 2014. The Internal Audit

plan is approved by the Audit Committee and the Internal Auditor presents their Internal Audit

Report directly to the Audit Committee.

Annexure I to Report on Corporate Governance

Market Price Data: High / Low from April 2017 to March 2018

Month

BSE NSE

High

(H)

Low

(H)

Volume

(Nos.)

High

(H)

Low

(H)

Volume

(Nos.)

April 2017 36.15 30.55 12,01,881 36.05 30.60 26,60,260

May 2017 40.95 32.95 9,76,881 41.15 32.80 23,92,327

June 2017 40.80 34.65 6,19,131 40.70 34.90 21,15,243

July 2017 46.35 34.65 24,01,648 46.30 36.05 38,74,342

August 2017 41.20 32.65 4,04,212 41.35 32.65 11,91,526

September 2017 38.20 33.10 3,64,083 38.00 33.05 7,75,605

October 2017 50.05 32.85 14,10,253 50.50 32.75 33,03,035

November 2017 53.00 45.60 11,13,721 52.50 45.80 24,08,826

December 2017 62.60 47.90 14,81,675 62.55 47.95 44,52,655

January 2018 60.50 49.90 24,18,978 60.70 49.65 51,86,880

February 2018 51.90 43.20 6,94,462 51.95 43.25 17,38,207

March 2018 50.95 41.95 18,22,783 52.05 42.60 21,92,328


Annexure II to Report on Corporate Governance

Comparison of Share Price & NSE Nifty - (Monthly High)

Annexure III to Report on Corporate Governance

Distribution of Shareholding (As on March 31, 2018)

Number of Equity Shares

held

Number of

Shareholders

Percentage of

Shareholders

Number of

Shares Held

Percentage of

Shareholdings

Upto 500 21,237 88.29 2,960,756 11.17

501 – 1,000 1,233 5.13 1,028,698 3.88

1,001 – 2,000 639 2.66 1,000,132 3.77

2,001 – 3,000 267 1.11 684,037 2.58

3,001 – 4,000 118 0.49 421,839 1.59

4,001 – 5,000 132 0.55 619,401 2.34

5,001 – 10,000 211 0.88 1,588,095 5.99

Above 10,000 218 0.91 18,212,367 68.59

Total 24,055 100.00 26,515,325 100.00

36.05

41.15 40.70

46.30

41.35

38.00

50.50 52.50

62.55 60.70

51.95

52.05

9,351.85 9,624.55

9,675.10

10,077.10

10,114.65

10,153.10

10,363.65 10,452.50

10,531.50

11,130.40 11,016.90

10,458.35

9,000.00

9,550.00

10,100.00

10,650.00

11,200.00

11,750.00

12,300.00

12,850.00

13,400.00

34

39

44

49

54

59

64

Apr 2

017

May

2017

Jun

2017

Jul 2

017

Aug 2

017

Sep

2017

Oct

2017

Nov 2017

Dec 2

017

Jan

2018

Feb

2018

Mar

2018

NSE

Nif

ty

Shar

e P

rice

(R

s.)

Price NSE Nifty


Annexure IV to Report on Corporate Governance

Shareholding Pattern of the Company (As on March 31, 2018)

CategoryNumber

of Shares

% of Share

Capital

A Shareholding of Promoter and Promoter Group

1) Indian Nil Nil

2) Foreign Nil Nil

Sub-Total Nil Nil

B Public Shareholding

1) Institutions

a) Mutual Funds & UTI 10,400 0.04

b) Financial Institutions / Banks 30,583 0.12

c) Foreign Institutional Investors / Foreign Portfolio Investors 147,734 0.56

d) Any Other (Foreign Banks) 900 0.00

Sub-Total 189,617 0.72

2) Non-Institutions

a) i) Individual Shareholders holding nominal share capital

upto H2 lac

9,422,562 35.54

ii) Individual Shareholders holding nominal share capital in

excess of H2 lac

11,070,310 41.74

b) Bodies Corporate 3,068,168 11.57

c) Clearing Members 1,353,018 5.10

d) Hindu Undivided Family 392,045 1.48

e) Non Resident Indians 990,905 3.74

f) Overseas Bodies Corporate 28,600 0.11

g) Trusts 100 0.00

Sub-Total 26,325,708 99.28

Grand Total 26,515,325 100.00

Annexure V to Report on Corporate Governance

Top 10 Shareholders of the Company (As on March 31, 2018)

Sr.

NoName of Shareholder Category

Number of

Shares Held

% of Total Equity

Share Capital

1. N. Jayakumar Public 3,124,759 11.78

2. Judith Investments Private Limited Public 1,783,497 6.73

3. Abhay Agarwal Public 1,147,765 4.33

4. Globalworth Securities Limited Public 968,895 3.65

5. Koppara Sajeeve Thomas Public 750,000 2.83

6. Multiplier Share & Stock Advisors Private

Limited

Public 706,000 2.66

7. Mohit Oswal Public 473,632 1.79

8. Apeksha Chopra Public 300,000 1.13

9. Suresh M Hegde Public 300,000 1.13

10. Akshay Gupta Public 231,708 0.87

Total 9,786,256 36.91


COMPlIAnCE CERTIFICATIOnDECLARATION REGARDING COMPLIANCE OF CODE OF CONDUCT BY

BOARD MEMBERS AND SENIOR MANAGEMENT PERSONNEL

This is to confirm that the Company has adopted a Code of Conduct for its Board Members and

all Senior Management Personnel in terms of the provisions of the Regulation 17(5) of SEBI (Listing

Obligations and Disclosure Requirements) Regulations, 2015. The Code of Conduct is posted on the

Company’s website.

I confirm that, pursuant to the provisions of the Regulation 26(3) of SEBI (Listing Obligations and

Disclosure Requirements) Regulations, 2015, all the Members of the Board and Senior Management

Personnel have affirmed compliance with the Code of Conduct for the year ended March 31, 2018.

For the purpose of this declaration, Senior Management Team means the Members of the

Management one level below the Board of Directors as on March 31, 2018.

Mumbai N. Jayakumar

May 29, 2018 Managing Director and Group CEO


CEO / CFO CERTIFICATIOn[Regulation 17(8) of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015]

The Board of Directors

Prime Securities Limited

Mumbai

This is to certify that:

(a) We have reviewed the Audited Financial Statements and the Cash Flow Statement for the Year

ended March 31, 2018 and that to the best of our knowledge and belief:

(i) These statements do not contain any materially untrue statement or omit any material fact

or contain statements that might be misleading;

(ii) These statements together present a true and fair view of the Company’s affairs and are in

compliance with existing Accounting Standards, applicable Laws and Regulations.

(b) There are, to the best of our knowledge and belief, no transactions entered into by the Company

during the Year ended March 31, 2018, which are fraudulent, illegal or violative of the Company’s

Code of Conduct.

(c) We accept responsibility for establishing and maintaining internal controls for financial reporting

and that we have evaluated the effectiveness of internal control systems of the Company

pertaining to financial reporting and we have disclosed to the Auditors and the Audit Committee,

the deficiencies in the design or operation of such internal controls, if any, of which we are aware

and the steps we have taken or propose to take to rectify these deficiencies.

(d) We have indicated to the Auditors and the Audit Committee that:

(i) There are no significant changes in internal controls during the Year ended March 31, 2018;

(ii) There are no significant changes in Accounting Policies during the Year ended March 31,

2018; and

(iii) We have not become aware of any instances of significant fraud, having the involvement of

the Management or an Employee, having a significant role in the Company’s internal control

system over financial reporting.

N. Jayakumar Nikhil Shah

Managing Director and Group CEO Chief Financial Officer

Mumbai, May 29, 2018


AUDITOR’S CERTIFICATE On CORPORATE GOVERnAnCE

To,

The Members of


We have examined the compliance of conditions of corporate governance by Prime Securities

Limited for the year ended on March 31, 2018 as stipulated in Regulations 17, 18, 19, 20, 21, 22, 23, 24,

25, 26, 27 and clauses (b) to (i) of sub-regulation (2) of regulation 46 and para C , D and E of Schedule

V of Securities and Exchange Board of India (Listing Obligations and Disclosures Requirements)

Regulations, 2015 (collectively referred to as “SEBI Listing Regulations, 2015).

The compliance of conditions of corporate governance is the responsibility of the Company’s

management. Our examination was carried out in accordance with the Guidance Note on

Certification of Corporate Governance issued by the Institute of Chartered Accountants of India and

was limited to procedures and implementation thereof, adopted by the Company for ensuring the

compliance of the corporate governance. It is neither an audit nor an expression of opinion of the

financial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us, we

certify that the Company has complied with the conditions of corporate governance as stipulated

in the provisions as stipulated in Securities and Exchange Board of India (Listing Obligations and

Disclosure Requirements) Regulations, 2015.

We further state that such compliance is neither an assurance as to the future viability of the

Company nor the efficiency or effectiveness with which management has conducted the affairs of

the Company.

For GANDHI & ASSOCIATES LLP

Chartered Accountants

(Firm Registration No. 102965W/W100192)

[MILIND GANDHI]

Mumbai, Partner

May 29, 2018 Membership No. 043194


FORM NO. MGT - 9EXTRACT OF ANNUAL RETURN

As on the financial year ended on March 31, 2018

[Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies

(Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS

i) CIN: L67120MH1982PLC026724

ii) Registration Date: 20-Mar-1982

iii) Name of the Company: Prime Securities Limited

iv) Category / Sub-Category of

the Company:

Company Limited by Shares

v) Address of the Registered

office and contact details:

1109/1110, Maker Chambers V, Nariman Point,

Mumbai 400021

vi) Whether listed company: Yes

vii) Name, Address and Contact

details of Registrar and

Transfer Agent, if any:

Link Intime India Private Limited

C-101, 247 Park, L.B.S Marg, Vikhroli (West),

Mumbai-400083,

Tel: +91-22-49186270, Fax: +91-22-49186060

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANYAll the business activities contributing 10% or more of the total turnover of the company shall be

stated

Sr

No.

Name and Description of

main products / services

NIC Code of the

Product/ service

% to total turnover

of the company

1 Merchant Banking Group 649 Class 6499

Sub-class 64990

100%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES

Sr

No.

Name and Address

of the Company

CIN/GLN Holding/

Subsidiary/

Associate

% of

Shares

Held

Applicable

Sections

1 Primesec Investments Limited

1109/1110, Maker Chambers V,

Nariman Point, Mumbai 400021

U67100MH2007PLC175947 Subsidiary

Company

100% Section

2 (87)

2 Prime Commodities Broking

(India) Limited, 1109/1110, Maker

Chambers V, Nariman Point,

Mumbai 400021


Company

100% Section

2 (87)

3 Prime Research & Adviosry

Limited, 1109/1110, Maker

Chambers V, Nariman Point,

Mumbai 400021


Company

100% Section

2 (87)

4 Primary Cuisine Private Limited

1109/1110, Maker Chambers V,

Nariman Point, Mumbai 400021

U55101MH2009PTC197818 Associate

Company

24% Section

2 (6)



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ii) Shareholding of Promoters

iv) Shareholding Pattern of top ten Shareholders as on 31-Mar-2018 (other than Directors,

Promoters and Holders of GDRs and ADRs)

Sr

No.

Shareholder’s

Name

Shareholding at the beginning

of the year (As on 01-Apr-2017)

Shareholding at the end of

the year (As on 31-Mar-2018)

%

Change

during

the

year

No. of

Shares

% of total

shares

of the

Company

% of shares

pledged /

encumbered

to total

shares

No. of

Shares

% of total

shares

of the

Company

% of shares

pledged /

encumbered

to total

shares

Nil

Total

iii) Change in Promoters’ Shareholding as on 31-Mar-2018 (please specify, if there is no change)

Shareholder’s Name Shareholding at the beginning

of the year (As on 01-Apr-2017)


the year (As on 31-Mar-2018)

No. of Shares % of total

shares of the

Company

No. of Shares % of total

shares of the

Company

At the beginning of the year

Not Applicable

Date wise Increase / Decrease

in Promoters Share holding

during the year specifying

the reasons for increase /

decrease (e.g. allotment /

transfer / bonus/ sweat equity

etc)

At the end of the year

For Each of the Top 10 Shareholders Shareholding at the

beginning of the year

(As on 01-Apr-2017)


the year

(As on 31-Mar-2018)

No. of

Shares

% of total

shares of the

company

No. of

Shares

% of total

shares of the

company

1. Judith Investments Private Limited 26,83,497 10.12 17,83,497 6.73

28/07/17 (9,00,000) Sale

2. Abhay Agarwal 10,01,000 3.78 11,47,765 4.33

28/07/17 (35,724) Sale

04/08/17 (9,014) Sale

11/08/17 (22,530) Sale




(As on 01-Apr-2017)


the year

(As on 31-Mar-2018)

No. of

Shares

% of total

shares of the

company

No. of

Shares

% of total

shares of the

company

18/08/17 (26,119) Sale

13/10/17 28,221 Purchase

20/10/17 13,354 Purchase

27/10/17 14,590 Purchase

03/11/17 7,901 Purchase

10/11/17 1,978 Purchase

17/11/17 13,000 Purchase

24/11/17 7,231 Purchase

01/12/17 9,612 Purchase

08/12/17 26,790 Purchase

29/12/17 (9,965) Sale

19/01/18 37,548 Purchase

26/01/18 20,000 Purchase

02/02/18 6,000 Purchase

09/02/18 17,000 Purchase

16/02/18 18,719 Purchase

23/02/18 28,173 Purchase

3. Global Worth Securities Limited 1,88,000 0.71 9,68,895 3.65

07/04/17 1,27,923 Purchase

14/04/17 93,662 Purchase

21/04/17 21,352 Purchase

28/04/17 43,081 Purchase

05/05/17 45,000 Purchase

12/05/17 13,000 Purchase

19/05/17 1,37,500 Purchase

26/05/17 (18,000) Sale

02/06/17 63,165 Purchase

09/06/17 92,154 Purchase

16/06/17 12,748 Purchase

23/06/17 (87,057) Sale

30/06/17 5,000 Purchase




(As on 01-Apr-2017)


the year

(As on 31-Mar-2018)

No. of

Shares

% of total

shares of the

company

No. of

Shares

% of total

shares of the

company

07/07/17 (65,019) Sale

14/07/17 1,45,920 Purchase

21/07/17 37,080 Purchase

28/07/17 (3,30,000) Sale

04/08/17 2,500 Purchase

15/09/17 (75,000) Sale

29/09/17 (7,500) Sale

27/10/17 (1,50,500) Sale

17/11/17 6,229 Purchase

24/11/17 73,771 Purchase

08/12/17 5,000 Purchase

15/12/17 (10,000) Sale

22/12/17 8,000 Purchase

12/01/18 5,68,991 Purchase

19/01/18 1,000 Purchase

02/02/18 (10,000) Sale

09/03/18 (50,000) Sale

16/03/18 80,895 Purchase

23/03/18 (1,000) Sale

31/03/18 1,000 Purchase

4. Koppara Sajeeve Thomas 7,50,000 2.83 7,50,000 2.83

5. Multiplier Share & Stock Advisors

Private Limited 1,60,000 0.60 7,06,000 2.66

07/04/17 (10,000) Sale

14/04/17 14,261 Purchase

21/04/17 (8,672) Sale

28/04/17 50,000 Purchase

19/05/17 9,411 Purchase

26/05/17 (10,000) Sale

02/06/17 20,000 Purchase

09/06/17 1,00,000 Purchase

16/06/17 (20,000) Sale




(As on 01-Apr-2017)


the year

(As on 31-Mar-2018)

No. of

Shares

% of total

shares of the

company

No. of

Shares

% of total

shares of the

company

07/07/17 14,000 Purchase

14/07/17 25,000 Purchase

28/07/17 (14,000) Sale

18/08/17 (5,000) Sale

16/03/18 3,80,000 Purchase

23/03/18 1,000 Purchase

6. Mohit Oswal 3,90,029 1.47 4,73,632 1.79

07/04/17 (50,000) Sale

14/04/17 (49,687) Sale

23/06/17 5,000 Purchase

30/06/17 44,212 Purchase

07/07/17 5,915 Purchase

14/07/17 10,000 Purchase

21/07/17 (5,000) Sale

28/07/17 (17,000) Sale

11/08/17 18,992 Purchase

18/08/17 10,000 Purchase

25/08/17 14,200 Purchase

01/09/17 17,855 Purchase

08/09/17 5,539 Purchase

15/09/17 8,000 Purchase

22/09/17 13,691 Purchase

29/09/17 14,594 Purchase

06/10/17 500 Purchase

13/10/17 (12,107) Sale

20/10/17 (66,838) Sale

27/10/17 (70,847) Sale

03/11/17 (35,085) Sale

10/11/17 (15,000) Sale

24/11/17 25,570 Purchase

01/12/17 6,592 Purchase




(As on 01-Apr-2017)


the year

(As on 31-Mar-2018)

No. of

Shares

% of total

shares of the

company

No. of

Shares

% of total

shares of the

company

08/12/17 21,610 Purchase

15/12/17 20,891 Purchase

29/12/17 15,000 Purchase

05/01/18 43,000 Purchase

12/01/18 (3,760) Sale

19/01/18 20,050 Purchase

26/01/18 62,928 Purchase

02/02/18 5,977 Purchase

09/02/18 18,302 Purchase

23/03/18 (20,000) Sale

31/03/18 20,509 Purchase

7. Apeksha Chopra 75,000 0.28 3,00,000 1.13

07/04/17 45,000 Purchase

14/04/17 25,000 Purchase

26/05/17 25,000 Purchase

09/06/17 (10,000) Sale

07/07/17 15,000 Purchase

15/09/17 20,000 Purchase

26/01/18 50,002 Purchase

09/02/18 59,998 Purchase

16/02/18 (25,000) Sale

23/02/18 20,000 Purchase

8. Suresh Madhava Hegde 8,01,828 3.02 3,00,000 1.13

15/12/17 (25,000) Sale

22/12/17 (1,00,000) Sale

29/12/17 91,118 Purchase

12/01/18 (4,67,946) Sale

9. Wisdom Global Enterprises Limited 2,50,000 0.94 2,50,000 0.94

10.Bakulesh Trambaklal Shah 5,00,000 1.89 1,33,500 0.50

01/12/17 (22,000) Sale

08/12/17 (12,217) Sale




(As on 01-Apr-2017)


the year

(As on 31-Mar-2018)

No. of

Shares

% of total

shares of the

company

No. of

Shares

% of total

shares of the

company

15/12/17 (24,371) Sale

22/12/17 (35,206) Sale

12/01/18 (2,56,206) Sale

23/03/18 (16,500) Sale

11. LTS Investment Fund Limited 3,29,417 1.24 1,00,000 0.38

07/04/17 (88,417) Sale

14/04/17 (16,000) Sale

05/05/17 1,25,000 Purchase

09/06/17 (70,760) Sale

16/06/17 (25,000) Sale

23/06/17 (22,506) Sale

07/07/17 (31,734) Sale

14/07/17 (23,176) Sale

28/07/17 (25,000) Sale

04/08/17 (56,396) Sale

11/08/17 (30,000) Sale

18/08/17 (65,428) Sale

12/01/18 4,10,000 Purchase

02/02/18 (3,15,000) Sale

23/03/18 5,000 Purchase

12. Chetan Rasiklal Shah 2,91,000 1.10 - -

07/04/17 (6,585) Sale

28/04/17 (73,433) Sale

12/05/17 (75,000) Sale

26/05/17 (23,451) Sale

09/06/17 (47,616) Sale

16/06/17 (64,500) Sale

23/06/17 (415) Sale

25/08/17 75,000 Purchase

15/09/17 17,074 Purchase

20/10/17 (2,574) Sale




(As on 01-Apr-2017)


the year

(As on 31-Mar-2018)

No. of

Shares

% of total

shares of the

company

No. of

Shares

% of total

shares of the

company

27/10/17 (14,500) Sale

24/11/17 (5,000) Sale

19/01/18 63,232 Purchase

26/01/18 51,768 Purchase

02/02/18 1,30,000 Purchase

09/02/18 5,000 Purchase

23/02/18 3,45,000 Purchase

16/03/18 (6,65,000) Sale

v) Shareholding of Directors and Key Managerial Personnel as on 31-Mar-2018

For Each of the Directors and KMP Shareholding at the


(As on 01-Apr-2017)


the year

(As on 31-Mar-2018)

No. of

Shares

% of total

shares of the

company

No. of

Shares

% of total

shares of the

company

1. N. Jayakumar 20,84,759 7.86 31,24,759 11.78

09/06/17 65,000 Purchase

04/08/17 9,00,000 Purchase

25/08/17 50,000 Purchase

31/03/18 25,000 Purchase

2. Anil Chandrakant Dharker - - 27,000 0.10

28/04/17 10,000 Purchase

23/02/18 15,000 Purchase

09/03/18 2,000 Purchase

3. Ajay Shah 11,600 0.04 6,100 0.02

11/04/17 (5,500) Sale


V. INDEBTEDNESS (Indebtedness of the Company including interest outstanding/accrued but

not due for payment)

VI REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNELA. Remuneration to Managing Director, Whole-time Directors and/or Manager

(H in Lacs)

Secured Loans

excluding deposits

Unsecured

Loans

Deposits Total

Indebtedness

Indebtedness at the beginning of the

financial year

i) Principal Amount 411.26 620.00 - 1,031.26

ii) Interest due but not paid - - - -

iii) Interest accrued but not due - - - -

Total (i+ii+iii) 411.26 620.00 - 1,031.26

Change in Indebtedness during

the financial year

•Addition 0.20 2.00 - 2.20

•Reduction 202.17 370.00 - 572.17

Net Change (201.97) (368.00) - 574.37

Indebtedness at the end of the

financial year

i) Principal Amount 209.29 252.00 - 461.29

ii) Interest due but not paid - - - -

iii) Interest accrued but not due - - - -

Total (i+ii+iii) 209.29 252.00 - 461.29

(H in Lacs)

Sr

No.

Particulars of Remuneration Name of MD /

WTD / Manager

Managing Director

N. Jayakumar

Total Amount

1 Gross Salary

(a) Salary as per provisions contained in section 17(1) of

the Income-tax Act, 1961

132.00 132.00

(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 1.83 1.83

(c) Profits in lieu of salary under section 17(3)

Income-tax Act, 1961

Nil Nil

2 Stock Option Nil Nil

3 Sweat Equity Nil Nil

4 Commission -

- as % of profit Nil Nil

- others, specify Nil Nil

5 Others, please specify Nil Nil

Total (A) 133.83 133.83

Ceiling as per the Act 5% of Net Profit /

Schedule V

10% of Net Profit

/ Schedule V


B. Remuneration to other Directors (H in Lacs)

Sr

No.

Particulars of Remuneration Name of Director

Pradip

Dubhashi

Alpana

Parida

Anil

Dharker

S. R.

Sharma

Total Amount

1 Independent Directors

•Feeforattendingboard/

committee meetings

11.50 11.10 11.30 9.40 43.30

•Commission - - - - -

•Others,pleasespecify - - - - -

Total (1) 11.50 11.10 11.30 9.40 43.30

2 Other Non-Executive

Directors

•Feeforattendingboard/

committee meetings

- - - - -

•Commission - - - - -

•Others,pleasespecify - - - - -

Total (2) - - - - -

Total (B) = (1+2)

Total Managerial

Remuneration

11.50 11.10 11.30 9.40 43.30

Overall Ceiling as per the Act 1% of Net Profit / Schedule V 3% of Net Profit

/ Schedule V

(H in Lacs)

Sr

No.

Particulars of Remuneration Key Managerial Personnel Total

AmountCompany

Secretary

Ajay Shah

CFO

Nikhil Shah

1 Gross Salary

(a) Salary as per provisions contained in section 17(1)

of the Income-tax Act, 1961

25.32 14.75 40.07

(b) Value of perquisites u/s 17(2) Income-tax Act,

1961

- -

(c) Profits in lieu of salary under section 17(3)

Income-

tax Act, 1961

- - -

2 Stock Option - - -

3 Sweat Equity - - -

4 Commission

- as % of profit - - -

- others, specify - - -

5 Others, please specify - - -

Total (A) 25.32 14.75 40.07

C. Remuneration to Key Managerial Personnel other than MD/Manager/WTD


VII PENALTIES / PUNISHMENT/ COMPOUNDING OF OFFENCES

Type Section of the

Companies Act

Brief

Description

Details of

Penalty /

Punishment /

Compounding

fees imposed

Authority

[RD /

NCLT /

COURT]

Appeal made,

if any

(give Details)

Company

Penalty

No Penalties, Punishments or Compounding of OffencesPunishment

Compounding

Directors

Penalty


Compounding

Other Officers in Default

Penalty


Compounding


AnnUAl REPORT On THE CSR ACTIVITIESAnnexure 4 to Director’s Report

1. Corporate Social Responsibility (“CSR”) forms an important part of the Prime Securities Limited’s overall philosophy of giving back to the society. The Company is committed to bring about positive changes in the environment it operates. The guiding principles of the Company’s CSR policy provide the businesses of the Company various means of achieving social integration.

The focus areas of our CSR initiatives are eradication of hunger, preventive healthcare, environment sustainability, women empowerment, girl education, child development and enhancing vocational skills. The CSR Policy of Prime Securities Limited is available on the Company’s website (www.primesec.com).

The activities and funding are monitored internally by the Company.

2. The Composition of the Corporate Social Responsibility Committee of the Board of Directors of Prime Securities Limited is as under:

- Pradip Dubhashi - Anil Dharker - N. Jayakumar

3. The Average Net Profit of the Company as per Section 198 of the Companies Act, 2013 and the Rules made thereunder for last three Financial Years is H273.49 lacs.

4. The Company has spent H19.00 lacs towards CSR for the Financial Year 2017-18.

In accordance with the Company’s CSR policy and in compliance with the Companies (Corporate Social Responsibility Policy) Rules 2014, Prime Securities Limited has undertaken number of CSR activities.

During the year under review, the Company identified various projects with Non-Profit Organizations which are registered as Public Charitable Trust or incorporated under Section 8 of the Companies Act, 2013.

5. Details of CSR spent during the Financial Year:

Total amount to be spent for the financial year H5.47 lacs.

Total amount spent for the financial year H19 lacs.

Amount unspent: NIL

Manner in which the amount was spent during the Financial Year 2017-18

6. The Company has spent the two percent of the average net profit of the latest three financial

years;

7. Pursuant to the Companies (Corporate Social Responsibility Policy) Rules, 2014, it is hereby

confirmed that the Corporate Social Responsibility Committee of the Board of Directors of Prime

Securities Limited has implemented and monitored the CSR initiatives of Prime Securities Limited

in line with CSR Objectives and Policy of the Company.

(H in Lacs)

Sr

No.

CSR Project /

Program

Sector

Covered

District and State

where Project /

Program was

Undertaken

Amount

Outlay

(Budget)

Amount

Spent

Cumulative

Expenditure upto

the reporting

period

Amount spent:

Direct / Through

implementing

agency

1. Child

Development

Education Pune,

Maharashtra

5.00 5.00 5.00 Direct

2. Beautification of

Road

Environment

Sustainability

Mumbai in

Maharashtra

9.00 9.00 9.00 Direct

3. Cancer Treatment Healthcare New Delhi 5.00 5.00 5.00 Direct

For and on behalf of the Board of Directors

Mumbai Pradip Dubhashi N. Jayakumar

May 29, 2018 Chairman of CSR Committee Managing Director and Group CEO


COnTEnTS OF CSR POlICy(Approved by the Board of Directors of Prime Securities Limited

at their meeting held on May 27, 2015)

Our aim is to be one of the most respected

Companies in India delivering superior and

sustainable value to all our customers, business

partners, shareholders, employees and host

communities.

The CSR initiatives focus on holistic

development of host communities and create

social, environmental and economic value to

the society.

The Company’s commitment to CSR projects

and programs will be by investing resources into

any of the following areas:

• Eradicating hunger, poverty & malnutrition,

promoting preventive health care & sanitation

& making available safe drinking water;

• Promoting education, including special

education & employment enhancing

vocation skills especially among children,

women, elderly & the differently unable &

livelihood enhancement projects;

• Promoting gender equality, empowering

women, setting up homes & hostels for

women & orphans, setting up old age homes,

day care centers & such other facilities for

senior citizens & measures for reducing

inequalities faced by socially & economically

backward groups;

• Reducing child mortality and improving

maternal health by providing good hospital

facilities and low cost medicines;

• Providing with hospital and dispensary

facilities with more focus on clean and

good sanitation so as to combat human

immunodeficiency virus, acquired immune

deficiency syndrome, malaria and other

diseases;

• Ensuring environmental sustainability,

ecological balance, protection of flora

& fauna, animal welfare, agro forestry,

conservation of natural resources &

maintaining quality of soil, air & water;

• Employmentenhancingvocationalskills

• Protectionofnationalheritage,art&culture

including restoration of buildings & sites of

historical importance & works of art; setting

up public libraries; promotion & development

of traditional arts & handicrafts;

• Measures for the benefit of armed forces

veterans, war widows & their dependents;

• Training to promote rural sports, nationally

recognized sports, sports & Olympic sports;

• ContributiontothePrimeMinister‘sNational

Relief Fund or any other fund set up by the

Central Government for socio-economic

development & relief & welfare of the

Scheduled Castes, the Scheduled Tribes,

other backward classes, minorities & women;

• Contributions or funds provided to

technology incubators located within

academic institutions, which are approved by

the Central Government;

• Ruraldevelopmentprojects,etc

• Slumareadevelopment.


FORM nO. MR-3SECRETARIAl AUDIT REPORT

FOR THE FINANCIAL YEAR ENDED MARCH 31, 2018

[Pursuant to Section 204(1) of the Companies Act, 2013 and Rule No. 9 of the Companies

(Appointment and Remuneration of Managerial Personnel) Rules, 2014]

The Members



We have conducted the secretarial audit of the

compliance of applicable statutory provisions

and the adherence to good corporate practices

by Prime Securities Limited (hereinafter called

“the Company”). Secretarial Audit was conducted

in a manner that provided us a reasonable

basis for evaluating the corporate conducts

/ statutory compliances and expressing our

opinion thereon.

Based on our verification of the Company’s

books, papers, minute books, forms and returns

filed and other records maintained by the

Company and also the information provided by

the Company, its officers, agents and authorized

representatives during the conduct of secretarial

audit, We hereby report that in our opinion,

the Company has, during the audit period

covering the financial year ended on March 31,

2018, complied with the statutory provisions

listed hereunder and also that the Company

has proper Board-processes and compliance

mechanism in place to the extent, in the manner

and subject to the reporting made hereinafter:

We have examined the books, papers, minute

books, forms and returns filed and other records

maintained by the Company for the financial

year ended on March 31, 2018 according to the

provisions of:

(i) The Companies Act, 2013 (“the Act”) and

the rules made there under;

(ii) The Securities Contracts (Regulation)

Act, 1956 (“SCRA”) and the rules made

thereunder;

(iii) The Depositories Act, 1996 and the

Regulations and Bye-laws framed

thereunder;

(iv) Foreign Exchange Management Act, 1999

and the rules and regulations made there

under;

(v) The following Regulations and Guidelines

prescribed under the Securities and

Exchange Board of India Act, 1992 (‘SEBI

Act’):-

(a) The Securities and Exchange Board of

India (Substantial Acquisition of Shares

and Takeovers) Regulations, 2011 as

amended from time to time;

(b) The Securities and Exchange Board of

India (Prohibition of Insider Trading)

Regulations, 2015 as amended from

time to time;

(c) The Securities and Exchange Board of

India (Share Based Employee Benefits)

Regulations, 2014 and amendments

from time to time;

(d) The Securities and Exchange Board of

India (Registrars to an Issue and Share

Transfer Agents) Regulations, 1993 and

amendments from time to time;

(e) The Securities and Exchange Board of


India (Merchant Bankers) Regulations,

1992 and amendments from time to

time;

(f) The Securities and Exchange Board of

India (Issue of Capital and Disclosures

Requirements) Regulation, 2009;

(g) The Securities and Exchange Board

of India (Issue and Listing of Debt

Securities) Regulation, 2008 (Not

Applicable during the Audit Period);

(h) The Securities and Exchange Board

of India (Delisting of Equity Shares)

Regulation, 2009 (Not Applicable

during the Audit Period); and

(i) The Securities and Exchange Board

of India (Buyback of Securities)

Regulation, 1998 (Not Applicable

during the Audit Period);

We have also examined compliance with the

applicable clauses of the following:

(a) Secretarial Standards issued by The Institute

of Company Secretaries of India (SS-1 & SS-

2);

(b) The Securities and Board of India (Listing

Obligations and Disclosure Requirements)

Regulations, 2015.

We further report that:

The Board of Directors of the Company

is duly constituted with proper balance of

Executive Directors, Non-Executive Directors

and Independent Directors. The changes in

the composition of the Board of Directors that

took place during the period under review were

carried out in compliance with the provisions of

the Act.

Adequate notice is given to all directors to

schedule the Board Meetings, agenda and

detailed notes on agenda were sent at least

seven days in advance, and a system exists for

seeking and obtaining further information and

clarifications on the agenda items before the

meeting and for meaningful participation at the

meeting.

During the period, all the decisions in the Board

Meetings were passed with requisite majority.

We have relied on the representation made by

the Company, its Officers and Reports of the

Statutory Auditor for systems and mechanism

framed by the Company for compliances under

other Acts, Laws and Regulations applicable to

the Company.

We further report that there are adequate

systems and processes in the Company

commensurate with the size and operations

of the Company to monitor and ensure

compliance with applicable laws, rules,

regulations and guidelines.

During the period under review the Company

has complied with the provisions of the Act,

Rules, Regulations, Guidelines etc. mentioned

above.

We further report that during the audit period

there were no specific events / actions having a

major bearing on the Company’s affairs.

Pramod S. Shah & Associates

(Practicing Company Secretaries)

Bharat Sompura

Partner

Mumbai ACS No: A10540

May 29, 2018 C. P. No: 5540


DISClOSURE In DIRECTORS’ REPORT PURSUANT TO SECTION 197(12) OF THE COMPANIES ACT, 2013 READ WITH THE COMPANIES

(APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONNEL), RULES, 2014

Sr.

No.

Requirements Disclosure

Name of the Director Ratio

1 The ratio of the remuneration

of each Director to the Median

Remuneration of the Employees

of the Company for the Financial

Year

N. Jayakumar, Managing Director and Group

CEO

6.55 X

Pradip Dubhashi, Chairman N.A.

Alpana Parida, Independent Director N.A.

Anil Dharker, Independent Director N.A.

S. R. Sharma, Non-Executive Director N.A.

1. The Median Remuneration of Employees of the

Company was H20.16 lacs.

2. Independent Directors are not paid any remuneration

except Sitting Fees, which has not been considered

as remuneration.

3. Non-Executive Directors are not paid any

remuneration as well as Sitting Fees.

4. Figures have been rounded off wherever necessary.

2 The percentage increase in

remuneration of each Director,

Chief Financial Officer and

Company Secretary in the

Financial Year

N. Jayakumar, Managing Director and Group

CEO

Nil

Pradip Dubhashi, Chairman N.A.

Alpana Parida, Independent Director N.A.

Anil Dharker, Independent Director N.A.

S. R. Sharma, Non-Executive Director N.A.

Nikhil Shah, Chief Financial Officer Nil

Ajay Shah, Company Secretary Nil

1. Increase, if any, in remuneration is made as per

appraisal system and Remuneration and Nomination

Policy of the Company.

2. Independent Directors are not paid any remuneration

except Sitting Fees, which has not been considered

as remuneration.

3. Non-Executive Directors are not paid any

remuneration as well as Sitting Fees.

3 The percentage increase in

the Median Remuneration of

Employees in the Financial Year

During FY 2018, the percentage increase in the median

remuneration of employees as compared to previous

year was Nil.



Sr.

No.

Requirements Disclosure

Name of the Director Ratio

4 The number of Permanent

Employees on the rolls of

Company

There were 9 employees as on March 31, 2018.

5 Average percentage increase

already made in the salaries

of employees other than the

managerial personnel in the last

financial year and its comparison

with the percentage increase in

the managerial remuneration and

justification thereof and point

out if there are any exceptional

circumstances for increase in the

managerial remuneration.

Average increase in remuneration is Nil for Employees

other than Managerial Personnel and Nil for Managerial

Personnel.

6 Affirmation that the remuneration

is as per the remuneration policy

of the Company.

Yes, it is confirmed.


EMPlOyEE STOCK OPTIOn SCHEME (ESOS)Disclosure pursuant to the provisions of the Securities and Exchange Board of India

(Share Based Employee Benefits) Regulations, 2014

Particulars ESOS 2009

a) Options granted 14,85,000

b) Pricing formula H38/- per share (Fair value determined based on

the closing market price on the date prior to the

date of grant of options)

c) Options vested 14,85,000

d) Options exercised Nil

e) The total number of shares arising as a

result of exercise of option

Nil

f) Options lapsed 13,78,600

g) Variation of terms of options Nil

h) Money raised by exercise of options Nil

i) Total number of options in force 1,06,400

j) Employee wise details of options granted

i) Senior managerial personnel Total 50,000 options granted to 1 senior

managerial personnel (employees one level below

the Board of Directors including employees of

subsidiaries) (Only summary given due to sensitive

nature of information)

ii) Any other employee who receives

a grant in any one year of option

amounting to 5% or more of the option

granted during that year

Nil

iii) Identified employees who were

granted option, during any one year,

equal to or exceeding 1% of the issued

capital (excluding outstanding warrants

and conversions) of the company at

the time of grant

Nil

k) Diluted Earnings Per Share (EPS) pursuant

to issue of shares on exercise of option

calculated in accordance with Accounting

Standard AS20 Earnings Per Share

H1.31 per share of face value of H5/- each



Particulars ESOS 2009

l) i) Method of calculation of employee

compensation cost

Intrinsic value method

ii) Difference between the employee

compensation cost so computed at (i)

above and cost that shall have been

recognized if it had used the fair value

of the options

Nil

iii) The impact of this difference on

profits and on EPS of the Company

The net loss would have been higher by H29.22

lacs and basic & diluted EPS would have been

lower by Nil

m) Weighted average exercise price and

weighted average fair value

Weighted average exercise price – H38/-

Weighted average fair value – H37.05

n) Fair value of options based on Black

Scholes methodology - assumptions

Risk free rate 8.10%

Expected life of options 8 Years

Expected volatility 64.25%

Expected dividends -

Closing market price of share on date of

option grant

H38.75


To,

The Members of


Report on the Indian Accounting Standards

(Ind AS) Financial Statements

We have audited the accompanying standalone

financial statements of PRIME SECURITIES

LIMITED (“the Company”), which comprise

the Balance Sheet as at March 31, 2018, the

Statement of Profit and Loss (including Other

Comprehensive Income) and the Statement of

Cash Flow, the statement of Changes in Equity

for the year then ended, and a summary of

the significant accounting policies and other

explanatory information (hereinafter referred to

as “standalone Ind AS financial statements”).

Management’s Responsibility for the Financial

Statements

The Company’s Board of Directors is responsible

for the matters stated in Section 134(5) of the

Companies Act, 2013 (“the Act”) with respect

to the preparation of these standalone Ind AS

financial statements that give a true and fair view

of the financial position, financial performance

(including Other Comprehensive Income), cash

flows and changes in equity of the Company

in accordance with the accounting principles

generally accepted in India, including the

Indian Accounting Standards (Ind AS) specified

under Section 133 of the Act, read with relevant

rules issued thereunder. This responsibility also

includes maintenance of adequate accounting

records in accordance with the provisions of the

Act for safeguarding the assets of the Company

and for preventing and detecting frauds and

other irregularities; selection and application

of appropriate accounting policies; making

judgments and estimates that are reasonable

and prudent; and design, implementation and

maintenance of adequate internal financial

controls, that were operating effectively for

ensuring the accuracy and completeness of the

accounting records, relevant to the preparation

and presentation of the standalone Ind AS

financial statements that give a true and fair

view and are free from material misstatement,

whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on

these standalone Ind AS financial statements

based on our audit.

We have taken into account the provisions of

the Act, the accounting and auditing standards

and matters which are required to be included

in the audit report under the provisions of the

Act and the Rules made thereunder.

We conducted our audit of the standalone Ind

AS financial statements in accordance with the

Standards on Auditing specified under Section

143(10) of the Act. Those Standards require that

we comply with ethical requirements and plan

and perform the audit to obtain reasonable

assurance about whether the standalone Ind

AS financial statements are free from material

misstatement.

An audit involves performing procedures to

obtain audit evidence about the amounts

and the disclosures in the standalone Ind AS

financial statements. The procedures selected

depend on the auditor’s judgment, including

the assessment of the risks of material

misstatement of the standalone Ind AS financial

statements, whether due to fraud or error. In

making those risk assessments, the auditor

considers internal financial control relevant to

the Company’s preparation of the standalone

Ind AS financial statements that give a true and

fair view in order to design audit procedures that

are appropriate in the circumstances. An audit

also includes evaluating the appropriateness

of the accounting policies used and the

reasonableness of the accounting estimates

made by the Company’s Directors, as well

as evaluating the overall presentation of the

standalone Ind AS financial statements.

Independent Auditor's Report


We believe that the audit evidence we have

obtained is sufficient and appropriate to provide

a basis for our audit opinion on the standalone

Ind AS financial statements.

Basis for Qualified Opinion

As referred in Note no. 32, the Company has,

in earlier financial year re-instated advance

of H327.50 Lacs which was earlier written-off

as not recoverable. Accordingly, the loss in

Surplus (Profit & Loss) is lower and Other Non-

Current Asset is higher by the said amount.

Qualified Opinion

In our opinion and to the best of our information

and according to the explanations given to us,

except for the effects of the matters described

in paragraph of the Basis for Qualified Opinion

paragraph, the said standalone Ind AS financial

statements give the information required by the

Act in the manner so required and give a true

and fair view in conformity with the accounting

principles generally accepted in India, of the

state of affairs of the Company as at March

31, 2018 and its total comprehensive income

(comprising of profit and other comprehensive

income), its cash flows and the changes in

equity for the year ended on that date.

Material Uncertainty Related to Going Concern

As referred to in Note no. 29 & 30, the net

worth of Company’s subsidiaries viz. Primesec

Investments Limited and Prime Research &

Advisory Limited have been eroded but having

regard to the circumstances specified in the

said Notes, the subsidiaries have prepared their

accounts on a going concern basis. Relying on

the same, the Company has not considered

making any adjustments to its financial exposure

in the subsidiaries. Our opinion is not modified

in respect of this matter.

Report on Other Legal and Regulatory

Requirements

1. As required by the Companies (Auditor’s

Report) Order, 2016 (“the Order”) issued by

the Central Government of India in terms

of section 143 (11) of the Act, we give in

the Annexure A, a statement on the matters

specified in paragraphs 3 and 4 of the

Order, to the extent applicable.

2. As required by Section 143 (3) of the Act,

we report that:

a) We have sought and obtained all the

information and explanations which to

the best of our knowledge and belief

were necessary for the purposes of

our audit.

b) In our opinion, proper books of

account as required by law have

been kept by the Company so far as

it appears from our examination of

those books.

c) The Balance Sheet, the Statement

of Profit and Loss (including Other

Comprehensive Income), the

statement of Cash Flow and the

Statement of Changes in Equity dealt

with by this Report are in agreement

with the books of account;

d) In our opinion, except for the effects

of the matters described in paragraph

of the Basis for Qualified Opinion

paragraph, the aforesaid standalone

Ind AS financial statements comply

with the Accounting Standards

specified under Section 133 of the

Act read with relevant rules issued

thereunder.

e) On the basis of the written

representations received from the

directors as on March 31, 2018 and

taken on record by the Board of

Directors, none of the directors is

disqualified as on March 31, 2018 from

being appointed as a director in terms

of Section 164 (2) of the Act.

f) With respect to the adequacy of

the internal financial controls over

financial reporting of the Company

and the operating effectiveness of


such controls, refer to our separate

report in “Annexure B”.

g) With respect to the other matters to

be included in the Auditor’s Report

in accordance with Rule 11 of the

Companies (Audit and Auditors) Rules,

2014 in our opinion and to the best of

our information and according to the

explanations given to us:

i. The Company has disclosed the

impact of pending litigations on its

financial position in its standalone

Ind AS financial statements –

Refer Note 28 to the standalone

Ind AS financial statements;

ii. The Company did not have any

long-term contracts including

derivative contracts for which

there were any material

foreseeable losses;

iii. There has been no delay in

transferring amounts, required

to be transferred to the Investor

Education and Protection Fund

by the Company during the year

ended March 31, 2018;

iv. The reporting on disclosures

relating to Specified Bank Notes

is not applicable to the Company

for the year ended March 31,

2018.



(FRN: 102965W/W100192)

[MILIND GANDHI]

Mumbai, Partner



Annexure - A to the Auditor's ReportThe annexure referred to in Independent Auditors’ Report to the members of the Company on the

financial statements for the year ended March 31, 2018 we report that:

1. a) The Company has maintained proper

records showing full particulars

including quantitative details and

situation of fixed assets.

b) As explained to us, all the fixed

assets were physically verified by the

management at reasonable intervals

during the year. According to the

information and explanations given to

us, no discrepancies were noticed on

such physical verification.

c) According to the information and

explanations given to us and on

the basis of our examination of the

records of the Company, the title

deeds of immovable property is yet

to be transferred in the name of the

Company pending a legal dispute as

disclosed in Note 1 to the standalone

Ind AS financial statements.

2. The Company does not hold any

inventories and therefore Clause 3(ii) of the

Order is not applicable to the Company.

3. The Company has granted unsecured

loans to wholly-owned subsidiary

companies covered in the register

maintained under Section 189 of the Act.

Considering the loans are to wholly-owned

subsidiaries, in our opinion, the terms and

conditions of the loans are not prejudicial

to the Company’s interest. The loans are

repayable on demand and during the year

part of loan to one subsidiary was repaid as

demanded. Interest is paid by the subsidiary

where applicable.

4. In our opinion and according to the

information and explanation given to us, the

Company has complied with the provisions

of Section 185 and 186 of the Act with

respect to the loans and investments made.

5. The Company has not accepted any

deposits within the meaning of the

directives issued by the Reserve Bank of

India and the provisions of section 73 to

76 or any other relevant provisions of the

Act and the rules framed thereunder and

therefore Clause 3(v) of the Order is not

applicable to the Company.

6. The Central Government has not

prescribed the maintenance of cost records

under Section 148(1) of the Act for any of

the services rendered by the Company and

hence the provisions of clause 3(vi) of the

Order is not applicable to the Company.

7. a) According to the information and

explanations given to us and the

records of the Company examined by

us, the Company is generally regular

in depositing with the appropriate

authorities undisputed statutory dues

including provident fund, income tax,

service tax, goods and service tax and

other statutory dues applicable to it.

Further, according to the information

and explanations given to us, there

are no undisputed amounts payable

in respect of provident fund, income

tax, service tax, goods and service

tax and other statutory dues with the

appropriate authorities outstanding

at the end of the year for a period of

more than six months from the date

they became payable.

b) According to the information and

explanations given to us, the particulars

of statutory dues outstanding at

the end of the year on account of a

dispute are as follows:

Statue Assessment

Year

Nature

Dues

Forum before whom pending HLacs

Income Tax

Act 1961

2006-2007 Income Tax Assessing Officer (Rectification

Proceedings)

13.18


8. Based on our audit procedures and

according to the information and

explanations given by the management, the

Company has not defaulted in repayment

of its loans and borrowings to any financial

institution and banks. The Company does

not have any loan or borrowing from

Government or debenture holders.

9. The Company did not raise any amount by

way of initial public offer or further public

offer (including debt instruments) and term

loans during the year. Accordingly Clause

3(ix) of the Order is not applicable.

10. During the course of our examination of

the books and records of the Company,

carried out in accordance with the

generally accepted auditing practices in

India, and according to the information and

explanations given to us, we have neither

come across any instance of material

fraud by the Company by its officers or

employees, noticed or reported during the

year, nor have been informed of any such

case by the management.

11. The Company has paid/provided for

managerial remuneration in accordance

with provisions of section 197 read with

Schedule V of the Act.

12. In our opinion and according to the

information and explanation given to us,

the Company is not a nidhi company and

therefore, Clause 3(xii) of the Order is not

applicable.

13. According to the information and

explanations given to us and based on

our examination of the records of the

Company, transactions with the related

parties are in compliance with Sections 177

and 188 of the Act where applicable and

the details of such transactions have been

disclosed in the standalone Ind AS financial

statements as required under Indian

Accounting standards (Ind AS) 24, Related

Party Disclosures specified under Section

133 of the Act, read with relevant rules.

14. The Company has not made any

preferential allotment or private placement

of shares or fully or partly convertible

debentures during the year and therefore,

Clause 3(xiv) of the Order is not applicable.

15. On the basis of our examination and

according to the information and

explanations given to us, the company has

not entered into any non-cash transactions

with directors or persons connected with

him and therefore, Clause 3(xv) of the

Order is not applicable.

16. The Company is not required to be

registered under Section 45-IA of the

Reserve Bank of India Act 1934 and

therefore Clause 3(xvi) of the Order is not

applicable.



(FRN: 102965W/W100192)

[MILIND GANDHI]

Mumbai, Partner



We have audited the internal financial controls

over financial reporting the Company as of

March 31, 2018 in conjunction with our audit

of the standalone Ind AS financial statements of

the Company for the year ended on that date.

Management’s Responsibility for Internal

Financial Controls

The Company’s management is responsible

for establishing and maintaining internal

financial controls based on the internal control

over financial reporting criteria established

by the Company considering the essential

components of internal control stated in the

Guidance Note on Audit of Internal Financial

Controls over Financial Reporting issued by

the Institute of Chartered Accountants of India

(‘ICAI’). These responsibilities include the design,

implementation and maintenance of adequate

internal financial controls that were operating

effectively for ensuring the orderly and efficient

conduct of its business, including adherence

to company’s policies, the safeguarding of its

assets, the prevention and detection of frauds

and errors, the accuracy and completeness

of the accounting records, and the timely

preparation of reliable financial information, as

required under the Act.

Auditors’ Responsibility

Our responsibility is to express an opinion

on the Company's internal financial controls

over financial reporting based on our audit.

We conducted our audit in accordance

with the Guidance Note on Audit of Internal

Financial Controls over Financial Reporting (the

“Guidance Note”) and the Standards on Auditing,

issued by ICAI and deemed to be prescribed

under section 143(10) of the Act, to the extent

applicable to an audit of internal financial

controls, both applicable to an audit of Internal

Financial Controls and, both issued by the ICAI.

Those Standards and the Guidance Note require

that we comply with ethical requirements and

plan and perform the audit to obtain reasonable

assurance about whether adequate internal

financial controls over financial reporting was

established and maintained and if such controls

operated effectively in all material respects.

Our audit involves performing procedures to

obtain audit evidence about the adequacy of the

internal financial controls system over financial

reporting and their operating effectiveness. Our

audit of internal financial controls over financial

reporting included obtaining an understanding

of internal financial controls over financial

reporting, assessing the risk that a material

weakness exists, and testing and evaluating

the design and operating effectiveness of

internal control based on the assessed risk. The

procedures selected depend on the auditor’s

judgment, including the assessment of the risks

of material misstatement of the standalone Ind

AS financial statements, whether due to fraud

or error.

We believe that the audit evidence we have

obtained is sufficient and appropriate to provide

a basis for our audit opinion on the Company’s


reporting.

Meaning of Internal Financial Controls over

Financial Reporting

A company's internal financial control over

financial reporting is a process designed

to provide reasonable assurance regarding

the reliability of financial reporting and the

Annexure - B to the Auditor's ReportReport on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the

Companies Act, 2013 (“the Act”)


preparation of financial statements for external

purposes in accordance with generally

accepted accounting principles. A company's

internal financial control over financial reporting

includes those policies and procedures that:

1. pertain to the maintenance of records that,

in reasonable detail, accurately and fairly

reflect the transactions and dispositions of

the assets of the Company; and,

2. provide reasonable assurance that

transactions are recorded as necessary to

permit preparation of standalone Ind AS

financial statements in accordance with

generally accepted accounting principles,

and that receipts and expenditures of

the Company are being made only

in accordance with authorizations

of management and directors of the

Company; and,

3. provide reasonable assurance regarding

prevention or timely detection of

unauthorized acquisition, use, or

disposition of the Company's assets that

could have a material effect on the financial

statements.

Inherent Limitations of Internal Financial

Controls Over Financial Reporting

Because of the inherent limitations of internal

financial controls over financial reporting,

including the possibility of collusion or improper

management override of controls, material

misstatements due to error or fraud may occur

and not be detected. Also, projections of any

evaluation of the internal financial controls over

financial reporting to future periods are subject

to the risk that the internal financial control over

financial reporting may become inadequate

because of changes in conditions, or that the

degree of compliance with the policies or

procedures may deteriorate.

Opinion

In our opinion, the Company has, in all material

respects, an adequate internal financial controls

system over financial reporting and such internal

financial controls over financial reporting were

operating effectively as at March 31, 2018 based

on the internal control over financial reporting

criteria established by the Company considering

the essential components of internal control

stated in the Guidance Note on Audit of Internal

Financial Controls over Financial Reporting

issued by the ICAI.



(FRN: 102965W/W100192)

[MILIND GANDHI]

Mumbai, Partner



(H in Lacs)

Note

No.

As at

31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

ASSETS

1. Non-Current Assets

(a) Property, Plant & Equipment 1 279.33 291.23 285.69

(b) Other Intangible assets 1 1.21 0.02 0.18

(c) Financial Assets

i) Investments in Subsidiaries 2(A) 848.00 848.00 848.00

ii) Other Investments 2(B) 33.18 23.70 2,670.58

(d) Deferred Tax Assets 89.23 - -

(e) Non-Current Advance tax Assets (Net) 157.44 168.59 169.73

(f) Other Non-Current Assets 3 347.43 347.43 19.93

Total Non-Current Assets 1,755.82 1,678.97 3,994.11

2. Current Assets

(a) Financial Assets

i) Investments 4 28.10 36.72 29.65

ii) Trade Receivables 5 64.73 28.78 -

iii) Cash & Cash Equivalents 6 5.76 9.24 61.04

iv) Loans 7 5,067.08 5,434.88 6,143.90

v) Other Financial Assets 8 3.58 3.58 3.58

(b) Other Current Assets 9 87.61 18.39 8.32

Total Current Assets 5,256.86 5,531.59 6,246.49

Total Assets 7,012.68 7,210.56 10,240.60

EQUITY AND LIABILITIES

1. Equity

(a) Equity Share capital 10 1,329.94 1,329.94 1,327.85

(b) Other Equity 11 4,943.69 4,582.31 4,119.20

Total Equity 6,273.63 5,912.25 5,447.05

2. Non-Current Liabilities

(a) Financial Liabilities

i) Borrowings 12 7.13 209.29 400.00

(b) Provisions 13 186.20 173.79 155.54

Total Non-Current Liabilities 193.33 383.08 555.54

3. Current Liabilities


i) Borrowings 14 250.00 620.00 3,824.95

ii) Trade Payables 15 31.77 53.60 114.89

iii) Other Financial Liabilities 16 204.17 201.97 203.34

(b) Other Current Liabilities 17 25.85 11.44 75.31

(c) Provisions 18 33.93 28.22 19.52

Total Current Liabilities 545.72 915.23 4,238.01

Total Equity and Liabilities 7,012.68 7,210.56 10,240.60

Balance Sheet as at March 31, 2018

Significant accounting policies Note No. 27

The notes referred to above form an integral part of the financial statements.

As per our Report attached For and on behalf of the Board

For and on behalf ofGANDHI & ASSOCIATES LLP N. Jayakumar Pradip Dubhashi Anil DharkerChartered Accountants Managing Director Chairman Director (FRN: 102965W/W100192)

Milind Gandhi S. R. Sharma Alpana Parida Ajay ShahPartner Director Director Company SecretaryMembership No. 043194

Mumbai, May 29, 2018 Mumbai, May 29, 2018


(H in Lacs)

Note

No.

Year ended

31-Mar-18

Year ended

31-Mar-17

I. Revenue from Operations 19 827.18 463.00

II. Other Income 20 72.24 213.60

III. Total Income (I+II) 899.42 676.60

IV. Expenses

Employee Benefits Expenses 21 259.51 118.51

Finance Cost 22 0.97 0.87

Depreciation and Amortization Expenses 1 14.62 12.68

Other Expenses 23 326.27 761.95

Total Expenses 601.37 894.01

V. Profit / (Loss) before Exceptional Items and Tax (III -IV) 298.05 (217.41)

VI. Exceptional Items 24 27.56 (473.56)

VII. Profit / (Loss) Before Tax ( V + VI ) 325.61 (690.97)

VIII. Tax Expense:

Current Tax 25 67.00 -

Deferred Tax (89.23) -

Tax from Earlier Years 0.64 -

IX. Profit / (Loss) for the Year (VII - VIII) 347.20 (690.97)

X. Other Comprehensive Income

Items that willl not be reclassified to profit or loss

Remeasurement of Defined Benefit Liability 26 (18.89) (32.89)

Income Tax effect on above 3.85 -

XI. Total Comprehensive Income for the Period (IX + X)

(Comprising Profit / (Loss) and other Comprehensive

Income for the Period)

332.16 (723.86)

XII. Earnings per Equity Share

Basic 1.31 (2.61)

Diluted 1.31 (2.61)

Statement of Profit & Loss for the year ended March 31, 2018

Significant accounting policies Note No. 27

The notes referred to above form an integral part of the financial statements.


For and on behalf of

GANDHI & ASSOCIATES LLP N. Jayakumar Pradip Dubhashi Anil Dharker

Chartered Accountants Managing Director Chairman Director

(FRN: 102965W/W100192)

Milind Gandhi S. R. Sharma Alpana Parida Ajay Shah

Partner Director Director Company Secretary

Membership No. 043194



(a) Equity Share Capital (H in Lacs)

Particulars As at 31st March, 2018 As at 31st March, 2017

No. of Shares

Amount No. of Shares

Amount

Balance at the Beginning of the Reporting Period 2,65,15,325 1,329.94 2,64,73,525 1,327.85

Changes in Equity Share Capital during the Year - - 41,800 2.09

Balance at the End of the Reporting Period 2,65,15,325 1,329.94 2,65,15,325 1,329.94

(b) Other Equity (H in Lacs)

Particulars Reserves and Surplus Items of Other

Comprehensive

Income

Total

Capital

Reserve

Capital

Redemption

Reserve

Securities

Premium

Reserve

Share

Options

outstanding

account

General

Reserve

Retained

Earnings

Remeasurements

of the net defined

benefit plans

Balance at April 1, 2016 165.00 217.27 5,312.64 - 2,400.00 (2,792.92) - 5,301.99

Profit for the Year - - - - - (690.97) - (690.97)

Actuarial Gain / (Loss) on

Defined Benefit Plan

- - - - - - (32.89) (32.89)

Other Comprehensive

Income for the Year

- - - - - - (32.89) (32.89)

Total comprehensive

income for the year

- - - - - (690.97) (32.89) (723.86)

Received on Issue of

Shares

- - 4.18 - - - - 4.18

Balance at March 31, 2017 165.00 217.27 5,316.82 - 2,400.00 (3,483.89) (32.89) 4,582.31

Profit for the year - - - - - 347.20 - 347.20

Share based payment to

employees

- - - 29.22 - - - 29.22

Actuarial gain / (Loss)

on defined benefits plan

net of tax

- - - - - - (15.04) (15.04)

Other comprehensive

income for the year

- - - - - - (15.04) (15.04)

Total Comprehensive

Income for the Year

- - - - - - (15.04) (15.04)

Balance at March 31, 2018 165.00 217.27 5,316.82 29.22 2,400.00 (3,136.69) (47.93) 4,943.69

Statement of Changes in Equity (SOCIE) for the year ended March 31, 2018





(FRN: 102965W/W100192)






Cash Flow Statement for the year ended March 31, 2018

(H in Lacs)

INFLOWS/(OUTFLOWS)

Year ended

31-Mar-18

Year ended

31-Mar-17

A CASH FLOW FROM OPERATING ACTIVITIES

Net Profit / (Loss) before tax from continuing

operations

306.72 (723.86)

Adjustments for :

Interest Received (20.63) (16.33)

Depreciation 14.62 12.68

Interest & Finance Charges 0.97 0.87

Loss / (Gain) on Sale of Investments (Net) (3.21) (192.47)

Amount Written-back (27.56) (973.16)

Balances written off - 1,446.72

(Appreciation) / Dimunition in value of Investments (0.86) 568.36

Provision for outstanding ESOS 29.22 -

(7.45) 846.67

Operating Profit / (Loss) before Working Capital

changes

299.27 122.81

Adjustments for Changes in the Working Capital

Debtors (35.96) (28.78)

Current Assets (69.21) -

Loans & Advances 365.35 698.97

Current Liabilities & Provisions 10.72 (62.58)

270.90 607.61

Cash generated from Operations 570.17 730.42

Direct Taxes (Paid) / Refund (net) (52.64) 1.15

Net Cash from Operating Activities (A) 517.53 731.57

B CASHFLOW FROM INVESTMENT ACTIVITIES

Purchase of Fixed Assets (3.91) (18.07)

Sale of Investments 3.21 2,000.00

Interest Received 20.63 16.33

Net Cash from Investment Activities (B) 19.93 1,998.26


Cash Flow Statement for the year ended March 31, 2018

(H in Lacs)

INFLOWS/(OUTFLOWS)

Year ended

31-Mar-18

Year ended

31-Mar-17

C CASHFLOW FROM FINANCING ACTIVITIES

Interest & Finance Charges (0.97) (0.87)

Proceeds from issue of shares (ESOS) - 6.26

Application Money against warrants 2.00 -

Funds Borrowed / (Repaid) (net) (541.97) (2,787.02)

Net Cash from Financing Activities (C) (540.94) (2,781.63)

Net Cashflow (A + B + C) (3.48) (51.80)

Changes in the Cash & Bank Balances (3.48) (51.80)

Cash and Cash Equivalents at the beginning of the year 9.24 61.04

Cash and Cash Equivalents at the end of the year 5.76 9.24





(FRN: 102965W/W100192)





Notes to the cash flow statement

1 Cash Comprises Cash on Hand and Current Accounts with Banks.

2 The Cash Flow statement has been prepared under the "Indirect Method" as set out in Indian

Accounting Standard (Ind AS -7) Statement of Cash flows.

3 Previous year's figures have been regrouped / recasted wherever necessary.


Notes to Financial Statement for the year ended March 31, 2018

1 - Property, Plant and Equipment (H in Lacs)

Particulars Tangible Intangible

Building Furniture & Fixture

Office Equipments

Vehicles Computers Total Computer Software

Total

Gross Block

Balance as at 1st April 2016 260.08 12.16 1.61 11.08 0.76 285.69 0.18 0.18

Additions - 0.90 0.29 15.54 1.34 18.07 - -

Adjustments - - - - - - - -

Disposals - - - - - - - -

Balance as at 31st March 2017 260.08 13.06 1.90 26.62 2.10 303.76 0.18 0.18


Additions - - 0.29 - 2.38 2.67 1.24 1.24


Disposals - - - - - - - -


Depreciation:

Balance as at 1st April 2016 - - - - - - - -

Charge for the year 6.55 2.02 0.57 2.81 0.57 12.52 0.16 0.16


Disposals - - - - - - - -



Charge for the year 6.55 2.04 0.47 4.33 1.19 14.58 0.05 0.05


Disposals - - - - - - - -


Net Block:

As at 31st March, 2017 253.53 11.04 1.33 23.81 1.53 291.23 0.02 0.02

As at 31st March, 2018 246.98 9.00 1.15 19.48 2.72 279.33 1.21 1.21

Deemed Cost as on 1st April 2016 (H in Lacs)

Particulars Building Furniture & Fixture

Office Equipments


Total

Gross Block 392.80 19.79 4.63 126.89 2.99 547.10 1.29 1.29

Less ; Accumulated Depreciation 132.72 7.63 3.02 115.81 2.23 261.41 1.11 1.11

Net Block 260.08 12.16 1.61 11.08 0.76 285.69 0.18 0.18

Note:1. Net block of the Building include a residential flat of H246.98 lacs in a co-operative society, acquired

from a debtor in satisfaction of a claim. In view of the restraining orders, the society has kept in abeyance the admission of membership of the Company. In the earlier year, pursuant to the order of the Hon’ble High Court, the possession of the flat was handed over to the Official Assignee. An appeal was filed by the Company against the said order whereby the said order was set aside. Pursuant to the fresh chamber summons filed by the Company for removing attachment, the Official Assignee has been directed not to sell or dispose-off the flat. The Company has been legally advised that the said developments will not have a bearing on the Company’s title to the flat and consequently there is no impairment in the value of the asset and the Company is not likely to have any further claim or liability against the said flat.

2. The Company has availed the deemed cost exemption in relation to the property, plant and equipment on the date of transition and hence the net block carrying amount has been considered as the gross block carrying amount on that date. Refer note below for the gross block value and the accumulated depreciation on April 1, 2016 under the previous GAAP.



2(A) - Investment in Subsidiaries (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Investment in Wholly-owned Subsidiary

Companies (Non-Trade)

(At Amortised Cost less Impairment)

Unquoted, Fully Paid-up

i) 53,41,000 (March 31, 2017 53,41,000 and April

1, 2016 53,41,000) Equity Shares of H10/- each

of Prime Broking Company (India) Limited

1,719.70 1,719.70 1,719.70

ii) 5,00,000 (March 31, 2017 5,00,000 and April 1,

2016 5,00,000) Equity Shares of H10/- each of


50.00 50.00 50.00

iii) 3,50,000 (March 31, 2017 3,50,000 and April 1,



33.02 33.02 33.02

iv) 16,36,000 (March 31, 2017 16,36,000 and April

1, 2016 16,36,000) Equity Shares of H10/- each

of Primesec Investments Limited

798.00 798.00 798.00

2,600.72 2,600.72 2,600.72

Less: Impairment in Value of Investments 1,752.72 1,752.72 1,752.72

Total (A) 848.00 848.00 848.00

2(B) - Other Investments (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

(At Fair Value through Profit & Loss Account)

I) Quoted, Fully Paid-up

i) Nil (March 31, 2017 Nil and April 1, 2016

2,19,000) Equity Shares of H10/- each of

ABG Shipyard Limited

- - 105.26

ii) Nil (March 31, 2017 Nil and April 1, 2016

6,500) Equity Shares of H10/- each of Dr.

Datsons Lab Limited

- - 0.41

iii) 14,37,277 (March 31, 2017 14,37,277 and

April 1, 2016 14,37,277) Equity Shares of

H10/- each of EL Forge Limited

- - 61.80

iv) 79,000 (March 31, 2017 79,000 and April 1,

2016 79,000) Equity Shares of H10/- each

of Greycells Education Limited

33.18 23.70 23.66

v) Nil (March 31, 2017 9,23,910 and April 1,

2016 9,23,910) Equity Shares of H10/- each

of IOL Netcom Limited

- - -

Total B (I) 33.18 23.70 191.13



3 - Other Non-Current Assets (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Unsecured, Considered good

Advances other than Capital Advances

i) Security Deposit 19.93 19.93 19.93

ii) Advance Given 327.50 327.50 -

Total 347.43 347.43 19.93

2(B) - Other Investments (contd...) (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

II) Unquoted, Fully Paid-up

i) 18,28,300 (March 31, 2017 18,28,300 and


H10/- each of Baron International Limited

- - -

ii) 1,00,000 (March 31, 2017 1,00,000 and


H10/- each of Blue Chip Technologies

Limited

- - -

iii) Nil (March 31, 2017 Nil and April 1, 2016

67,295) Equity Shares of H10/- each of

Business India Publication Limited

- - 69.37

iv) 28,500 (March 31, 2017 28,500 and April 1,

2016 28,500) Equity Shares of H10/- each

of Gateway Entertainment Limited

- - -

v) Nil (March 31, 2017 Nil and April 1, 2016

4,01,674) Equity Shares of H10/- each of

Roop Automotives Limited

- - 1,807.53

vi) 5,35,000 (March 31, 2017 5,35,000 and


H10/- each of Sarju International Limited

- - -

vii) 3,20,000 (March 31, 2017 3,20,000 and


H10/- each of Trinity Fuels Limited

- - -

viii) 6,23,687 (March 31, 2017 6,23,687 and April

1, 2016 8,73,687) Equity Shares of H10/-

each of Tunip Agro Limited

- - 602.55

- - 2,479.45

Less: Impairment in Value of Investments - - -

Total B (I) - - 2,479.45

Total B [B (I)+B (II)] 33.18 23.70 2,670.58


4 - Investments (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

In Other Companies (Non-Trade)

Quoted, Fully Paid-up

i) Nil (March 31, 2017 Nil and April 1, 2016 9,000)

Equity Shares of H10/- each of Hi-tech Plast

Limited

- - 14.80

ii) 4,00,000 (March 31, 2017 4,00,000 and April 1,


International Hometex Limited

- - -

iii) 41,939 (March 31, 2017 41,939 and April 1,

2016 41,939) Equity Shares of H10/- each of

Solid Stone Limited

28.10 36.72 14.85

Total 28.10 36.72 29.65

5 - Trade Receivables (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Unsecured, Considered Good 64.73 28.78 -

Total 64.73 28.78 -

8 - Other Financial Assets (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Other Receivables 3.58 3.58 3.58

Total 3.58 3.58 3.58

6 - Cash and Cash Equivalents (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Cash on Hand 0.18 0.58 8.14

Balance with Banks in Current Accounts 5.58 8.66 52.90

Total 5.76 9.24 61.04

7 - Loans (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Unsecured, Considered Good

Loans to Related Parties

Subsidiary Companies 5,115.67 5,483.47 6,192.49

Less: Provision for Doubtful Loans (48.59) (48.59) (48.59)

Total 5,067.08 5,434.88 6,143.90



9 - Other Current Assets (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16


Prepaid Expenses 8.82 11.93 5.69

Other Advances 78.79 6.46 2.63

Total 87.61 18.39 8.32

10 - Equity Share Capital (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Authorised

3,50,00,000 (March 31, 2017 3,00,00,000, April 1,

2016 3,00,00,000) Equity Shares of H5/- each

1,750.00 1,500.00 1,500.00

Nil (March 31, 2017 2,00,000, April 1, 2016

2,00,000) 13% Cumulative Redeemable

Preference Shares of H100/- each

- 200.00 200.00

18,00,000 (March 31, 2017 18,00,000, April 1, 2016

18,00,000) Unclassified Shares of H100/- each

1,800.00 1,800.00 1,800.00

Total 3,550.00 3,500.00 3,500.00

Issued

2,72,64,525 (March 31, 2017 2,72,64,525 April 1,


1,363.23 1,363.23 1,361.14

Total 1,363.23 1,363.23 1,361.14

Subscribed & Fully Paid-up

2,65,15,325 (March 31, 2017 2,65,15,325 April 1,


1,325.77 1,325.77 1,323.68

Add : Share Forfeiture Account [7,48,600 Equity

Shares forfeited]

4.17 4.17 4.17

(Refer Note no 33)

Total 1,329.94 1,329.94 1,327.85

11 - Other Equity (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

a) Capital Reserve

The Reserve comprises of Profits / Gains of

Capital nature earned by the Company and

credited directly to such Reserve

At the Commencement and at the End of the

Year 165.00 165.00

Total 165.00 165.00 165.00



11 - Other Equity (contd...) (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

b) Capital Redemption Reserve

As per the Companies Act, 2013, the Capital

Redemption Reserve is created when the

Company purchases its own Shares out of Free

Reserves or Securities Premium. A sum equal to

the Nominal Value of the Shares so purchased

is transferred to Capital Redemption Reserve


Year 217.27 217.27

Total 217.27 217.27 217.27

c) Securities Premium

Securities Premium is used to record the

premium on issue of Shares. The Reserve is

utilised in accordance with the provisions of

the Companies Act, 2013

At the Commencement of the Year 5,316.82 5,312.64

Add: Received during the Year - 4.18

Total 5,316.82 5,316.82 5,312.64

d) Share Options Outstanding Account

The amount is provided on determination

of fair value of options in accordance with

requirements of Ind AS 102

At the commencement of the Year - -

Add: Provided during the Year 29.22 -

Total 29.22 - -

e) General Reserve

General Reserve forms part of the Retained

Earnings and is permitted to be distributed to

Shareholders as part of Dividend


Year 2,400.00 2,400.00

Total 2,400.00 2,400.00 2,400.00

f) Surplus

At the Commencement of the Year (3,483.89) (3,975.71)

Add: Adjustment due to Restatement on Fair

Value of Investments

- 1,182.79

Add: Net Profit / (Loss) for the Year 347.20 (690.97)

Total (3,136.69) (3,483.89) (3,975.71)



11 - Other Equity (contd...) (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

g) Items of Other Comprehensive Income

Remeasurement of Defined Benefit Liability

Remeasurements of the Net Defined Benefit

Plans comprises Actuarial Gains and Losses

and Return on Plan Assets (excluding interest

income).

At the Commencement of the Year (32.89) -

Add: Remeasurement of Defined Benefit

Liability

(15.04) (32.89)

Total (47.93) (32.89) -

Total Other Equity 4,943.69 4,582.31 4,119.20

12 - Borrowings - Non-Current Liabilities (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Secured Loan (For Security and terms of

repayment : Refer Note no 34)

Term Loan from Bank 7.13 9.29 -

Other Loan from Bank - 200.00 400.00

Total 7.13 209.29 400.00

14 - Borrowings - Current Liabilities (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16



Loans repayable on demand from Other Party - - 2,185.00

Unsecured

Loans repayable on demand from Banks - - 400.00

Loans repayable on demand from Other Party - 30.00 555.00

Loans and advances from Related Parties 250.00 590.00 684.95

Total 250.00 620.00 3,824.95

13 - Non-Current Provisions (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Provision for Employee Benefits

(Refer note no 43)

Compensated Absences 186.20 173.79 155.54

Total 186.20 173.79 155.54



15 - Trade Payables (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

a) Due to Micro, Small and Medium Enterprise

(Refer note no 35)

- - -

b) Due to Others 31.77 53.60 114.89

Total 31.77 53.60 114.89

16 - Other Current Financial Liabilities (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

a) Current Maturities of Long-Term Debt (Refer

Note no 34)

202.17 201.97 203.34

b) Application Money received for Allotment of

Warrants

2.00 - -

Total 204.17 201.97 203.34

17 - Other Current Liabilities (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

a) Revenue received in Advance 2.40 2.40 2.40

b) Statutory Dues Payable (includes Provident

Fund, GST, Withholding Tax etc.)

10.39 1.07 38.26

c) Outstanding Expenses Payable 13.06 7.97 34.65

Total 25.85 11.44 75.31

18 - Current Provisions (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Provision for Employee Benefits

(Refer note no 43)

Gratuity 17.73 12.24 4.58


Total 33.93 28.22 19.52

19 - Revenue from Operations (H in Lacs)

Year ended 31-Mar-18

Year ended

31-Mar-17

Merchant Banking and Advisory Fees 827.18 463.00

Total 827.18 463.00



22 - Finance Costs (H in Lacs)


Year ended

31-Mar-17

Interest Expense 0.97 0.87

Total 0.97 0.87

20 - Other Income (H in Lacs)


Year ended

31-Mar-17

Interest Income 20.63 16.33

Net Gain / (Loss) on Sale of Investments 3.21 192.47

Appreciation in Value of Investments 0.86 -

Gain on Foreign Exchange Transactions 2.74 -

Rent 4.80 4.80

Reimbursement of Expenses 40.00 -

Total 72.24 213.60

21 - Employee Benefits Expense (H in Lacs)


Year ended

31-Mar-17

Salaries 251.24 108.46

Contribution to Provident and Other Funds 4.16 3.73

Staff Welfare Expenses 4.11 6.32

Total 259.51 118.51

23 - Other Expenses (H in Lacs)


Year ended

31-Mar-17

Electricity Expenses 3.03 3.49

Rent 37.99 39.36

Repairs & Maintenance 5.53 8.11

Insurance Premium 2.90 2.66

Rates & Taxes 0.36 1.82

Travelling & Conveyance 38.03 27.41

Consultancy & Professional Charges 95.21 45.58

Director's Sitting Fees 43.30 5.90

Auditor's Remuneration

- For Audit Fees 6.00 6.20

- For Other Services 0.85 0.75

Corporate Social Responsibility Expenses 19.00 5.00

Diminution in Value of Investments - 568.35

Miscellaneous Expenses 74.08 47.31

Total 326.27 761.95



25 - Tax Expenses(a) Amounts recognised in Profit & Loss (H in Lacs)


Year ended

31-Mar-17

Current Income Tax 67.00 -

Adjustment in respect of Current Income Tax of Previous Year 0.64 -

Deferred Income Tax Liability / (Asset), Net

Origination and Reversal of Temporary Differences (89.23) -

Deferred Tax Expense (89.23) -

Tax Expense for the Year (21.59) -

Effective Tax Rate for the Year N. A. N. A.

24 - Exceptional Items (H in Lacs)


Year ended

31-Mar-17

Amounts Written Back 27.56 973.16

Balances Written off - (1,446.72)

Total 27.56 (473.56)

(b) Amounts Recognised in Other Comprehensive Income (H in Lacs)

Year ended 31-Mar-18 Year ended 31-Mar-17

Before Tax

Tax (Expense)

Benefit

Net of Tax

Before

Tax

Tax

(Expense)

Benefit

Net of

Tax

Items that will not be

reclassified to profit or loss

Remeasurement of defined

benefit liability

(18.89) 3.85 (15.04) (32.89) - (32.89)

(18.89) 3.85 (15.04) (32.89) - (32.89)

(c) Reconciliation of Effective Tax Rate (H in Lacs)


Year ended

31-Mar-17

Profit Before Tax 306.72 (690.97)

Applicable Tax Rate 27.55% 27.55%

Computed Tax Expense 84.51 -

Tax effect of:

Allowances (12.65) -

Expenses Disallowed 14.46 -

Capital Gains Set off against brought forward losses (0.88) -

Brought forward losses (49.19) -

MAT under Section 115JB 26.91 -

Current Tax Provision (A) 63.15 -



(H in Lacs)


Year ended

31-Mar-17

Deferred Tax Asset on account of Property, Plant and Equipment (27.99) -

Deferred Tax Asset on account of Retirement Benefit of

Employees

(61.24) -

Deferred Tax Provision (B) (89.23) -


Tax Expense recognised in Statement of Profit and Loss (A)+(B)+(C) (25.44) -

The Applicable Indian Corporate Statutory Rate for the year ended March 31, 2018 and 2017 is 27.55%.

(d) Movement in Deferred Tax Balances (H in Lacs)

March 31, 2018

Net Balance April 1, 2017

Recognised in Profit or

Loss

Net Balance

March 31,

2018

Deferred

Tax Asset

Deferred

Tax Liability

Deferred Tax Asset /

(Liabilities)

Property, Plant and Equipment - 27.99 27.99 27.99 -

Employee Benefits - 61.24 61.24 61.24 -

Tax Assets / (Liabilities) - 89.23 89.23 89.23 -

Set off Tax - - - - -

Net Tax Assets / (Liabilities) - 89.23 89.23 89.23 -

1) The Company offsets Tax Assets and Liabilities if and only if it has a legally enforceable right to

set off Current Tax Assets and Current Tax Liabilities and the Deferred Tax Assets and Deferred Tax

Liabilities relate to Income Taxes levied by the same Tax Authority.

2) Significant management judgment is required in determining Provision for Income Tax,

Deferred Income Tax Assets and Liabilities and recoverability of Deferred Income Tax Assets.

The recoverability of Deferred Income Tax Assets is based on estimates of Taxable Income in

which the relevant entity operates and the period over which Deferred Income Tax Assets will be

recovered.

26 - Other Comprehensive Income (H in Lacs)


Year ended

31-Mar-17

Gratuity Provision (5.54) (7.68)

Leave Encashment Provision (13.35) (25.21)

Total (18.89) (32.89)



27 Significant accounting policiesa) Basis of preparation of Financial Statements:

The Financial Statements of the Company have been prepared in accordance with the Indian

Accounting Standards (Ind AS) to comply with the section 133 of the Companies Act 2013

(“the 2013 Act”), read with Rule 3 of the Companies (Indian Accounting Standards) Rule 2015,

and Companies (Indian Accounting Standards) Rules, 2016. For all periods up to and for the

year ended 31 March 2016, the Company prepared its financial statements in accordance with

accounting standards notified under the section 133 of the Companies Act 2013, read together

with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP). These financial

statements are the Company’s first Ind AS financial statements and are covered by Ind AS 101,

First-time adoption of Indian Accounting Standards. The transition to Ind AS has been carried out

from the accounting principles generally accepted in India (“Indian GAAP”) which is considered

as the “Previous GAAP” for purposes of Ind AS 101. An explanation of how the transition to Ind

AS has affected the Company’s equity and its net profit is provided in Note no 45. The financial

statements were authorised for issue by the Company’s Board of Directors on May 29, 2018.

All the assets and liabilities have been classified as current or non-current as per the Company’s

normal operating cycle and other criteria set out in Schedule III to the Act. The Company has

ascertained the operating cycle to be 12 months.

Functional and presentation currency:

These financial statements are presented in Indian rupees, which is the Company’s functional

currency. All amounts have been rounded off to two decimal places to the nearest lakh, unless

otherwise indicated.

Historical cost convention:

The financial statements have been prepared on a historical cost basis, except for the following:

•certainfinancialassetsandliabilitiesaremeasuredatfairvalue;

•definedbenefitplans–planassetsmeasuredatfairvalue

b) Use of Estimates and Judgements:

The preparation of financial statements in accordance with Ind AS requires use of estimates and

assumptions for some items, which might have an effect on their recognition and measurement

in the balance sheet and statement of profit and loss. The actual amounts realised may differ

from these estimates. Estimates and assumptions are required in particular for:

• DeterminationoftheestimatedusefullivesofPropertyPlantandEquipments:

Useful lives of Property Plant and Equipments are based on the life prescribed in Schedule II of

the Companies Act, 2013.

• Recognitionandmeasurementofdefinedbenefitobligations:

The obligation arising from defined benefit plan is determined on the basis of actuarial

assumptions. Key actuarial assumptions include discount rate, trends in salary escalation,

actuarial rates and life expectancy. The discount rate is determined by reference to market

yields at the end of the reporting period on government bonds. The period to maturity of

the underlying bonds correspond to the probable maturity of the post-employment benefit

obligations.

• Recognitionofdeferredtaxassets:

Deferred tax assets and liabilities are recognized for the future tax consequences of temporary

differences between the carrying values of assets and liabilities and their respective tax



bases, and unutilized business loss and depreciation carry-forwards and tax credits. Deferred

tax assets are recognized to the extent that it is probable that future taxable income will be

available against which the deductible temporary differences, unused tax losses, depreciation

carry-forwards and unused tax credits could be utilized.

• Recognitionandmeasurementofotherprovisions:

The recognition and measurement of other provisions are based on the assessment of the

probability of an outflow of resources, and on past experience and circumstances known at

the balance sheet date. The actual outflow of resources at a future date may therefore vary

from the amount included in other provisions.

• Discountingoflong-termfinancialassets/liabilities:

All financial assets / liabilities are required to be measured at fair value on initial recognition. In

case of financial liabilities/assets which are required to subsequently be measured at amortised

cost, interest is accrued using the effective interest method.

• Segmentreporting:

Operating segments are reported in a manner consistent with the internal reporting. The

Company prepares its segment information in conformity with the accounting policies

adopted for preparing and presenting the financial statements of the Company as a whole.

• Measurementoffairvalues:

The Company’s accounting policies and disclosures require the measurement of fair values

for financial instruments.

The Company has an established control framework with respect to the measurement

of fair values. The management regularly reviews significant unobservable inputs and

valuation adjustments. If third party information, such as broker quotes or pricing services,

is used to measure fair values, then the management assesses the evidence obtained from

the third parties to support the conclusion that such valuations meet the requirements of

Ind AS, including the level in the fair value hierarchy in which such valuations should be

classified.

When measuring the fair value of a financial asset or a financial liability, the Company uses

observable market data as far as possible. Fair values are categorised into different levels in a

fair value hierarchy based on the inputs used in the valuation.

• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

• Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset

or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

• Level 3: inputs for the asset or liability that are not based on observable market data

(unobservable inputs).

• If the inputs used to measure the fair value of an asset or a liability fall into different levels of

the fair value hierarchy, then the fair value measurement is categorised in its entirety in the

same level of the fair value hierarchy as the lowest level input that is significant to the entire

measurement.

• The Company recognises transfers between levels of the fair value hierarchy at the end of

the reporting period during which the change has occurred.



c) Property, plant and equipment:

• Recognitionandmeasurement:

Items of property, plant and equipment are measured at cost less accumulated depreciation

and any accumulated impairment losses.

The cost of an item of property, plant and equipment comprises:

Its purchase price, including import duties and non-refundable purchase taxes, after deducting

trade discounts and rebates.

Any costs directly attributable to bringing the asset to the location and condition necessary for

it to be capable of operating in the manner intended by management.

Any gain or loss on disposal of an item of property, plant and equipment is recognised in profit

or loss.

The cost of the property, plant and equipments as at 1st April 2016, the Company’s date of

transition to Ind AS, was determined with reference to its carrying value at that date.

d) Depreciation:

• Depreciationontangibleassetsisprovidedonthestraight-linemethodovertheusefullivesof

assets as prescribed under Part C of Schedule II of the Companies Act, 2013;

Useful life of Property Plant and Equipment are reviewed at each balance sheet date and

adjusted prospectively, if appropriate.

• Depreciationonadditiontoassetsoronsale/discardmentofassets, iscalculatedprorata

from the date of such addition or upto the date of such sale/discardment, as the case may be;

• IndividualassetsexceptassetsgivenonleaseacquiredforlessthanH5,000 are depreciated

entirely in the year of acquisition.

e) Intangible Fixed Assets:

Intangible assets, which are acquired by the Company and have finite useful lives are measured

at cost less accumulated amortisation and any accumulated impairment losses.

The cost of intangible assets at April 1, 2016, the Company’s date of transition to Ind AS, was

determined with reference to its carrying value at that date.

f) Financial Instruments:

A financial instrument is any contract that gives rise to a financial asset of one entity and a

financial liability or equity instrument of another entity. Financial instruments also include

derivative contracts such as foreign currency foreign exchange forward contracts and, interest

rate swaps and currency options; and embedded derivatives in the host contract.

Financial instruments also covers contracts to buy or sell a non-financial item that can be settled

net in cash or another financial instrument, or by exchanging financial instruments, as if the

contracts were financial instruments, with the exception of contracts that were entered into

and continue to be held for the purpose of the receipt or delivery of a non-financial item in

accordance with the entity’s expected purchase, sale or usage requirements.

Financial Assets:

Classification:

The Company shall classify financial assets as subsequently measured at amortised cost, fair

value through other omprehensive income or fair value through profit or loss on the basis of its



business model for managing the financial assets and the contractual cash flow characteristics

of the financial asset.

Initial recognition and measurement:

All financial assets are recognised initially at fair value plus, in the case of financial assets not

recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition

of the financial asset. Purchases or sales of financial assets that require delivery of assets within a

time frame established by regulation or convention in the market place (regular way trades) are

recognised on the trade date, i.e., the date that the Company commits to purchase or sell the

asset.

Equity investments:

Equity investments in subsidiaries are measured at cost less impairment.

All other equity investments in scope of Ind AS 109 are measured at fair value. Equity instruments

which are held for trading are classified as at FVTPL. For all other equity instruments, the

Company decides to classify the same either as at FVOCI or FVTPL. The Company makes such

election on an instrument-by-instrument basis. The classification is made on initial recognition

and is irrevocable.

If the Company decides to classify an equity instrument as FVOCI, then all fair value changes

on the instrument, excluding dividends, are recognized in the OCI. There is no recycling of the

amounts from OCI to profit and loss, even on sale of investment. However, the Company may

transfer the cumulative gain or loss within equity.

Equity instruments included within the FVTPL category are measured at fair value with all changes

recognized in the profit and loss.

Derecognition:

A financial asset (or, where applicable, a part of a financial asset or part of a Company of similar

financial assets) is primarily derecognised (i.e. removed from the Company’s balance sheet)

when:

• Therightstoreceivecashflowsfromtheassethaveexpired,or

• TheCompanyhastransferreditsrightstoreceivecashflowsfromtheassetorhasassumed

an obligation to pay the received cash flows in full without material delay to a third party

under a ‘passthrough’ arrangement; and either (a) the Company has transferred substantially

all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained

substantially all the risks and rewards of the asset, but has transferred control of the asset

When the Company has transferred its rights to receive cash flows from an asset or has entered

into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and

rewards of ownership. When it has neither transferred nor retained substantially all of the risks and

rewards of the asset, nor transferred control of the asset, the Company continues to recognise

the transferred asset to the extent of the Company’s continuing involvement. In that case, the

Company also recognises an associated liability. The transferred asset and the associated liability

are measured on a basis that reflects the rights and obligations that the Company has retained.

Continuing involvement that takes the form of a guarantee over the transferred asset is

measured at the lower of the original carrying amount of the asset and the maximum amount of

consideration that the Company could be required to repay.



Impairment of financial assets:

In accordance with Ind-AS 109, the Company applies expected credit loss (ECL) model for

measurement and recognition of impairment loss on the following financial assets and credit risk

exposure:

a) Financial assets that are debt instruments, and are measured at amortised cost e.g., loans,

debt securities, deposits, and bank balance.

b) Trade receivables - The application of simplified approach does not require the company

to track changes in credit risk. Rather, it recognises impairment loss allowance based on

lifetime ECLs at each reporting date, right from its initial recognition. Trade receivables are

tested for impairment on a specific basis after considering the sanctioned credit limits,

security like letters of credit, security deposit collected etc. and expectations about future

cash flows.

Financial liabilities:

Classification

The Company classifies all financial liabilities as subsequently measured at amortised cost, except

for financial liabilities at fair value through profit or loss. Such liabilities, including derivatives that

are liabilities, shall be subsequently measured at fair value.


Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through

profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments

in an effective hedge, as appropriate.

All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings

and payables, net of directly attributable and incremental transaction cost.

Amortised cost is calculated by taking into account any discount or premium on acquisition and

fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs

in the statement of profit and loss.

The Company’s financial liabilities include trade and other payables, loans and borrowings

including bank overdrafts and derivative financial instruments.

Derecognition:

A financial liability is derecognised when the obligation under the liability is discharged or

cancelled or expires. When an existing financial liability is replaced by another from the same

lender on substantially different terms, or the terms of an existing liability are substantially

modified, such an exchange or modification is treated as the derecognition of the original

liability and the recognition of a new liability. The difference in the respective carrying amounts is

recognised in the statement of profit or loss.

Offsetting of financial instruments:

Financial assets and financial liabilities are offset and the net amount is reported in the balance

sheet if there is a currently enforceable legal right to offset the recognised amounts and there is

an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.

g) Employee Benefits:

Short Term Employee Benefits:

All employee benefits payable within twelve months of rendering the service are recognised in

the period in which the employee renders the related service.



Post Employment / Retirement Benefits:

Contribution to Defined Contribution Plans such as Provident Fund, Employees’ State Insurance

Corporation, etc., are charged to the Statement of Profit and Loss as incurred.

Defined Benefit Plans – The present value of the obligation under such plans, is determined

based on an actuarial valuation by an independent actuary at the end of each year, using the

Projected Unit Credit Method. In the case of gratuity, which is funded, the fair value of the plan

assets is reduced from the gross obligation under the defined benefit plans, to recognise the

obligation on net basis.

Remeasurement of net defined benefit liability, which comprises actuarial gains and losses and

the return on plan assets (excluding interest) and the effect of the asset ceiling (if any excluding

interest), are recognized immediately in other comprehensive income.

Other Long Term Employee Benefits:

Compensated Absences:

Accumulated compensated absences, which are expected to be availed or encashed within 12

months from the end of the year end are treated as short term employee benefits. The obligation

towards the same is measured at the expected cost of accumulating compensated absences as

the additional amount expected to be paid as a result of the unused entitlement as at the year end.

Accumulated compensated absences, which are expected to be availed or encashed beyond 12

months from the end of the year end are treated as other long term employee benefits. The

Company’s liability is actuarially determined (using the Projected Unit Credit method) at the end

of each year. Actuarial losses/ gains are recognised in the Statement of Profit and Loss in the year

in which they arise.

h) Foreign Exchange Transactions:

Transactions in foreign currencies are translated into the respective functional currencies of the

Company at the exchange rates at the dates of the transactions.

Monetary assets and liabilities denominated in foreign currencies are translated into the functional

currency at the exchange rate at the reporting date. Non-monetary assets and liabilities that are

measured at fair value in a foreign currency are translated into the functional currency at the

exchange rate when the fair value was determined. Foreign currency differences are generally

recognised in statement of profit or loss. Non-monetary items that are measured based on

historical cost in a foreign currency are translated using the exchange rate as at the date of

transaction.

i) Borrowing Costs:

Borrowing costs that are directly attributable to the acquisition or construction of an asset that

necessarily takes a substantial period of time to get ready for its intended use are capitalised as

part of the cost of that asset till the date it is ready for its intended use or sale. Other borrowing

costs are recognised as an expense in the period in which they are incurred.

j) Recognition of Income and Expenditure:

i) Merchant Banking and Advisory Fees are accrued as per the terms of contract except where

there is uncertainty as to their realization.

ii) Revenue/Income and Cost/Expenditure are accounted on accrual as they are earned or

incurred, except in case of significant uncertainties.

iii) Dividend income is recognised when the right to receive is established.



iv) Interest income is recognised on accrual basis.

v) Gain or losses on sale of investments are recognized on trade dates by comparing the sales

realization with the weighted average cost of such investment.

k) Leases:

Lease payments:

Payments made under operating leases are recognised in profit or loss on a straight line basis

over the term of the lease unless such payments are structured to increase in line with expected

general inflation to compensate for the lessor’s expected inflationary cost increase. Lease

incentives received are recognised as an integral part of the total lease expense, over the term of

the lease.

Minimum lease payments made under finance leases are apportioned between the finance

expense and the reduction of the outstanding liability. The finance expense is allocated to

each period during the lease term so as to produce a constant periodic rate of interest on the

remaining balance of the liability.

Assets held under other leases are classified as operating leases and are not recognised in the

Company’s statement of financial position.

l) Impairment of non-financial assets:

The carrying values of assets/cash generating units at each balance sheet date are reviewed for

impairment if any indication of impairment exists. If the carrying amount of the assets exceed the

estimated recoverable amount, an impairment is recognised for such excess amount.

The recoverable amount is the greater of the net selling price and their value in use. Value in use

is arrived at by discounting the future cash flows to their present value based on an appropriate

discount factor.

When there is indication that an impairment loss recognised for an asset (other than a revalued

asset) in earlier accounting periods which no longer exists or may have decreased, such reversal

of impairment loss is recognised in the Statement of Profit and Loss, to the extent the amount

was previously charged to the Statement of Profit and Loss. In case of revalued assets, such

reversal is not recognised.

m) Cash and cash equivalents:

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and

short-term deposits with an original maturity of three months or less, which are subject to an

insignificant risk of changes in value.

For the purpose of the statement of cash flows, cash and cash equivalents consist of cash and

short-term deposits, as defined above, net of outstanding bank overdrafts as they are considered

an integral part of the Company’s cash management.

n) Taxation:



an integral part of the Company’s cash management.

i) Current tax:

Current tax comprises the expected tax payable or receivable on the taxable income or loss

for the year and any adjustment to the tax payable or receivable in respect of previous years.



It is measured using tax rates enacted or substantively enacted at the reporting date. Current

tax also includes any tax arising from dividends.

Current tax assets and liabilities are offset only if, the Company:

a) has a legally enforceable right to set off the recognised amounts; and

b) intends either to settle on a net basis, or to realise the asset and settle the liability

simultaneously.

ii) Deferred tax:

Deferred tax is recognised in respect of temporary differences between the carrying

amounts of assets and liabilities for financial reporting purposes and the amounts used for

taxation purposes. Deferred tax is not recognised for:

• temporarydifferencesontheinitialrecognitionofassetsorliabilitiesinatransactionthat

is not a business combination and that affects neither accounting nor taxable profit or

loss;

• temporarydifferencesrelatedtoinvestmentsinsubsidiariesandassociatestotheextent

that the Company is able to control the timing of the reversal of the temporary differences

and it is probable that they will not reverse in the foreseeable future; and

• taxabletemporarydifferencesarisingontheinitialrecognitionofgoodwill.

Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible

temporary differences to the extent that it is probable that future taxable profits will be

available against which they can be used. Deferred tax assets are reviewed at each reporting

date and are reduced to the extent that it is no longer probable that the related tax benefit

will be realised; such reductions are reversed when the probability of future taxable profits

improves.

Unrecognized deferred tax assets are reassessed at each reporting date and recognised to

the extent that it has become probable that future taxable profits will be available against

which they can be used.

Deferred tax is measured at the tax rates that are expected to be applied to temporary

differences when they reverse, using tax rates enacted or substantively enacted at the

reporting date.

The measurement of deferred tax reflects the tax consequences that would follow from

the manner in which the Company expects, at the reporting date, to recover or settle the

carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset only if:

a) The entity has a legally enforceable right to set off current tax assets against current tax

liabilities; and

b) The deferred tax assets and the deferred tax liabilities relate to income taxes levied by

the same taxation authority on the same taxable entity.

Deferred tax asset / liabilities in respect of on temporary differences which originate and

reverse during the tax holiday period are not recognised. Deferred tax assets / liabilities in

respect of temporary differences that originate during the tax holiday period but reverse after

the tax holiday period are recognised.



o) Provisions, Contingent Assets and Contingent Liabilities:

Provisions are determined by discounting the expected future cash flows specific to the liability.

The unwinding of the discount is recognised as finance cost. A provision for onerous contracts

is measured at the present value of the lower of the expected cost of terminating the contract

and the expected net cost of continuing with the contract. Before a provision is established, the

Company recognises any impairment loss on the assets associated with that contract.

A disclosure for a contingent liability is made when there is a possible obligation or a present

obligation that may, but will probably not, require an outflow of resources. When there is a

possible obligation or a present obligation in respect of which the likelihood of outflow of

resources is remote, no provision or disclosure is made.

A contingent asset is not recognised but disclosed in the financial statements where an inflow of

economic benefit is probable.

(H in Lacs)

Sr.

No.

Particulars March 31, 2018

March 31,

2017

April 1,

2016

i) Demands raised by Tax Authorities against which

the Company has preferred appeals

13.18 13.18 13.18

ii) Corporate guarantee given for financial facilties

for subsidiaries

- - 15.00

iii) Claims made not acknowledged as debts - 1,855.99 2,593.34

28 Contingent Liabilities to the extent not provided for in respect of:

29 The Company has a financial exposure of H5,341.37 lacs (H5,974.11 lacs) in its wholly-owned

subsidiary viz. Primesec Investments Limited ('PIL') - investment in equity shares of H798.00 lacs

(H798.00 lacs) and loans & advances of H4,543.37 lacs (H5,176.11 lacs). PIL has a negative net worth

of H4,263.02 lacs (H5,083.02 lacs). However, having regard to efforts undertaken by the Board of

PIL, among other things to negotiate re-statement of loans and realize value of its investments,

the financial statements of PIL have been prepared on the basis that it is a going-concern and

that no adjustments are required to the carrying value of assets and liabilities. Considering that

the Company’s investment in PIL is of strategic and long term in nature and having regard to the

efforts undertaken by the Board of PIL, no provision is considered necessary by the management

for diminution in the value of the Company’s financial exposure in PIL.

30 The Company has advanced H175.22 lacs (H143.22 lacs) to its wholly-owned subsidiary viz. Prime

Research & Advisory Limited (`PRAL`). PRAL has a negative net worth of H234.32 lacs (H343.35

lacs). However, having regard to efforts undertaken by the Board of PRAL, among other things

to negotiate re-statement of loans and realize value of its investments, the financial statements

of PRAL have been prepared on the basis that it is a going-concern and that no adjustments are

required to the carrying value of assets and liabilities. Considering that the Company’s investment

in PRAL is of strategic and long term nature and having regard to the efforts undertaken by the

Board of PRAL, no provision is considered necessary by the management.

31 In the earlier financial years, the company had written-back H1,400 Lacs as in the opinion of the



management, the same was no longer payable. The Company has been legally advised that

there will be no liability due as the debt had become time-barred.

32 In the earlier financial year, the Company has reinstated an advance of H327.50 lacs which was

previously written-off as not recoverable. The management is hopeful of recovery of the same.

33 Share capital:(a) Rights, preferences and restrictions attached to Equity Shares:

The Company has only one class of equity shares having a par value of H5/- per share. Each

shareholder is eligible for one vote per share held. The dividend proposed by the Board of

Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting,

except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible

to receive the remaining assets of the Company after distribution of all preferential amounts, in

proportion to their shareholding.

(b) Details of equity shares held by shareholders holding more than 5% of the aggregate equity

shares in the Company:

(c) Reconciliation of number of equity shares outstanding as on beginning and closing of the year

Employees Stock Option Schemes (ESOS)

The Company’s stock based compensation plan for employees comprises of three schemes

viz. the ESOS 2007 Scheme, ESOS 2008 and the ESOS 2009 Scheme. The schemes have been

instituted for all eligible employees of the Company and its subsidiaries. The Company has

reserved issuance of 1,06,400 (Previous year 2,53,200) Equity Shares of H5/- each for offering to

eligible employees of the Company and its subsidiaries under Employees Stock Option Scheme

(ESOS) approved by Members. During the year, the Company has granted NIL (Previous year NIL)

Options to the eligible employees.

Name of the

ShareholderAs at March 31, 2018 As at March 31, 2017 As at April 1, 2016

No. of shares held

% of Holding

No. of shares held

% of

Holding

No. of

shares

held

% of

Holding

Judith Investments

Private Limited

17,83,497 6.73 26,83,497 10.12 26,83,497 10.14

N. Jayakumar 31,24,759 11.78 20,84,759 7.86 20,84,759 7.87

Videocon Industries

Limited

- - - - 17,62,565 6.66

Particulars 2017-18 2016-17 2015-16

Numbers H in Lacs Numbers H in Lacs Numbers H in Lacs

Opening Balance 2,65,15,325 1,329.94 2,64,73,525 1,327.85 2,64,73,525 1,327.85

Add: Shares issued

during the year

- - 41,800 2.09 - -

Closing Balance 2,65,15,325 1,329.94 2,65,15,325 1,329.94 2,64,73,525 1,327.85



ESOS 2007 Scheme

The Scheme permits allocation of an aggregate of 1,000,000 equity shares of the face value

of H5/- per share to the eligible employees on the recommendation of the Compensation

Committee at an exercise price of H38/-.

ESOS 2008 Scheme




ESOS 2009 Scheme




The number of options granted, exercised and lapsed under the above schemes is set out below:

Particulars (Exercise

Price)ESOS 2007 (H38/-) ESOS 2008 (H15/-) ESOS 2009 (H38/-)

Current Year

Previous Year

Current Year

Previous Year

Current Year

Previous

Year

Options outstanding,

beginning of the Year

40,000 80,000 - 88,400 2,13,200 3,20,000

Add: Granted during

the Year

- - - - - -

Less: Exercised during

the Year

- - - 41,800 - -

Less: Lapsed during

the Year

40,000 40,000 - 46,600 1,06,800 1,06,800


end of the Year

- 40,000 - - 1,06,400 2,13,200

The fair value has been calculated using the Black-Scholes Option Pricing Model and the

significant assumptions and inputs to estimate the fair value of options during the year are as

follows:

Sr.

No.

Particulars 2017-18

(A) Weighted average risk-free rate 8.10%

(B) Weighted average expected life of options 8 years

(C) Weighted average expected volatility 64.25%

(E) Weighted average share price H37.05 Per Share

(F) Weighted average exercise price H38 Per Share

(G) Method used to determine expected volatility Based on the returns generated on

equity shares of Company for the

period from 2005 to 2010

Expense on Employee Stock Options Scheme debited to the Statement of Profit and Loss during

the year is H29.22 Lakhs.



34 Borrowings: (A) Secured loans:

a) Term Loan from Bank:

Term loan of H9.29 Lakhs (March 31, 2017 H11.26 lakhs) from the Bank is secured against

Vehicle of the Company.

b) Other Loan from Bank:

Other Loan from Bank of H200 Lakhs (March 31, 2017 H400 Lakhs, March 31, 2016 H600

Lakhs) is secured against pledge of shares of other parties.

c) Term of Repayment

Term Loan from Bank is repayable in equal monthly instalment, the last instalment is due on

December 1, 2021 as per repayment schedule having interest rate of 9.50% p.a. Other Loan

from bank is interest free and repayable in equal yearly instalment, the last instalment is due

on December 31, 2018.

(B) Unsecured loans:

Loan from other party is unsecured, interest free and repayable on demand. Loan from related

party is from an associate company in which a director is interested. It is an interest free unsecured

loan and repayable on demand.

35 Dues to micro and small suppliers: Under the Micro, Small and Medium Enterprises Development Act, 2006, (MSMED) which came

into force from October 2, 2006, certain disclosures are required to be made relating to Micro,

Small and Medium enterprises. On the basis of the information and records available with the

management, there are no outstanding dues to the Micro and Small enterprises as defined in the

Micro, Small and Medium Enterprises Development Act, 2006.

Particulars 31-Mar-18 31-Mar-17 01-Apr-16

Principal amount remaining unpaid to any supplier

as at the year end

- - -

Interest due thereon - - -

Amount of interest paid by the Company in terms

of section 16 of the MSMED, along with the amount

of the payment made to the supplier beyond the

appointed day during the accounting year

- - -

Amount of interest due and payable for the period

of delay in making payment (which have been paid

but beyond the appointed day during the period)

but without adding the interest specified under the

MSMED

- - -

Amount of interest accrued and remaining unpaid

at the end of the accounting year

- - -



36 Related Party Disclosures: Related party disclosures in respect of related parties with whom transactions have taken place

during the year are given below:

Names of related parties and their relationships:

Subsidiary Companies: Prime Research & Advisory Limited


Primesec Investments Limited

Associate Companies: Gateway Entertainment Limited

Judith Investments Private Limited

Key Management Personnels: Mr. N. Jayakumar

Mr. Ajay Shah

Independent Directors: Mr. Pradip Dubhashi

Mr. S R Sharma

Mr. Anil Dharker

Ms. Alpana Parida

Relative of Key Management Personnel: Mrs. Madhu Jayakumar

The following transactions were carried out with the related parties in the ordinary course of

business during the year 2017-2018: (H in Lacs)

Sr.

No.

Nature of Transaction Relationship Transactions

Current Year

Previous

Year

1 Interest received from Prime Commodities

Broking (India) Limited

Subsidiary 17.71 8.18

2 Inter corporate deposit paid to Prime

Commodities Broking (India) Limited

Subsidiary

- Sums Paid 1,167.45 189.00

- Refund received 950.45 423.50

3 Interest free Inter corporate deposit paid to


Subsidiary

- Sums Received 1.00 -

- Sums paid 33.00 63.20

4 Interest free Inter corporate deposit given to

Primesec Investment Limited

Subsidiary

- Sums paid 1,217.62 79.28

- Sums Received 1,850.36 625.00

5 Interest free Inter corporate deposit received

from Gateway Entertainment Limited

Associate

Company

- Write back of ICD no longer payable 30.00 -

6 Remuneration paid to Key Managerial

Personnel

Key Management

Personnel

159.00 66.28

7 Sitting Fees for Board and Committee

Meetings to Independent Directors

Key Management

Personnel

43.30 5.90

8 Shares issued to Key Managerial Personnel Key Management

Personnel

- 2.49



Outstanding Balance (H in Lacs)

Sr.

No.

Nature of Transaction Relationship Balance as on

March 31, 2018

March 31, 2017

1 Outstanding amount receivable from Prime

Broking Company (India) Limited on current

account

Subsidiary 48.59

(Debit)

48.59

(Debit)

2 Inter corporate deposit given to Prime

Commodities Broking (India) Limited

Subsidiary 348.49

(Debit)

115.55

(Debit)



Subsidiary 175.22

(Debit)

143.22

(Debit)


Primesec Investment Limited

Subsidiary 4,543.37

(Debit)

5,176.11

(Debit)

5 Interest free Inter corporate deposit from

Gateway Entertainment Limited

Associate

Company

- 30.00

(Credit)

6 Interest free unsecured loan from Mr N

Jayakumar

Key

Management

Personnel

- 255.00

(Credit)

7 Interest free unsecured Inter Corporate

Deposit from Judith Investments Private

Limited

Associate

Company

250.00

(Credit)

335.00

(Credit)

Note:

The remuneration paid to key managerial personnel excludes gratuity and compensated

absences as the provision is computed for the company as a whole and separate figures are

not available.

(H in Lacs)

Sr.

No.


Current Year

Previous

Year

9 Repayment of Interest free unsecured loan

received from Mr. N Jayakumar

Key Management

Personnel

255.00 94.95

10 Repayment of Interest free unsecured Inter

Corporate Deposit from Judith Investments

Private Limited

Associate

Company

85.00 -

37 Operating Lease in respect of Assets taken on Lease: (H in Lacs)

Sr.

No.


Year ended

March 31, 2017

i) Total of future minimum lease payments

a) Not later than one year 38.16 33.49

b) Later than one year and not later than five years 41.64 51.30

ii) Lease payments recognised in the Profit and Loss

account

37.99 39.36



38 In accordance with IND AS 108 – Operating Segment, segment information has been given

in the Consolidated Financial Statement of Prime Securities Limited and therefore no separate

disclosure on segment information is given in these financial statements.

39 Subsequent Events : There are no significant subsequent events that would require adjustments or disclosures in the

financial statements as on the balance sheet date.

40 Corporate Social Responsibility As required by Section 135 of Companies Act, 2013 and rules therein, a Corporate social

responsibility committee has been formed by the Company. The Company has spent the

following amount during the year towards Corporate Social Responsibility (CSR) for activities

listed under schedule VII of the Companies Act, 2013

(a) Gross amount required to be spent by the Company during the year 2017-18 H5.05 lakhs

(Previous year H Nil).

(b) Amount spent during the year on:

41 Financial instruments – Fair values and risk managementA) Accounting classification and fair values

Carrying amounts and fair values of financial assets and financial liabilities, including their levels

in the fair value hierarchy, are presented below. It does not include the fair value information

for financial assets and financial liabilities not measured at fair value if the carrying amount is a

reasonable approximation of fair value.

(H in Lacs)

Particulars 2017-18 2016-17 2015-16

(i) Construction / acquisition of any asset - - -

(ii) On purpose other than (i) above 19.00 5.00 -

(H in Lacs)

March 31, 2018

Carrying amount Fair value

FVTPL FVTOCI Amortised

Cost

Total Level 1 Level 2 Level 3 Total

Financial assets

Non Current Investments * 33.18 - - 33.18 - - - -

Security Deposits - - 19.93 19.93 - 19.93 - 19.93

Advance Given - - 327.50 327.50 - - - -

Quoted Equity Shares 28.10 - - 28.10 - - - -

Trade receivables - - 64.73 64.73 - - - -

Cash and cash equivalents - - 5.76 5.76 - - - -

Loans - - 5,067.08 5,067.08 - 5,067.08 - 5,067.08

Other Current Financial Assets - - 3.58 3.58 - - - -

61.28 - 5,488.58 5,549.86 - 5,087.01 - 5,087.01

Financial liabilities

Non - current borrowings - - 7.13 7.13 - 7.13 - 7.13

Current borrowings - - 250.00 250.00 - - - -

Trade and other payables - - 31.77 31.77 - - - -

Other Current financial liabilities - - 204.17 204.17 - - - -

- - 493.07 493.07 - 7.13 - 7.13



(H in Lacs)

March 31, 2017

Carrying amount Fair value


Cost


Financial assets



Advance Given - - 327.50 327.50 - - - -




Loans - - 5,434.88 5,434.88 - 5,434.88 - 5,434.88


60.42 - 5,823.90 5,884.32 - 5,454.81 - 5,454.81






- - 1,084.86 1,084.86 - 209.29 - 209.29

(H in Lacs)

April 1, 2016 Carrying amount Fair value


Cost


Financial assets





Loans - - 6,143.90 6,143.90 - 6,143.90 - 6,143.90


220.78 - 6,228.45 6,449.23 - 6,163.83 - 6,163.83



Current borrowings - - 3,824.95 3,824.95 - - - -



- - 4,543.18 4,543.18 - 400.00 - 400.00

* The fair value in respect of the unquoted equity investments is equal to the cost of the investments

as per the contractual arrangements.



B) Measurement of fair values:

Valuation techniques and significant unobservable inputs

The following tables show the valuation techniques used in measuring Level 2 and Level 3 fair

values, as well as the significant unobservable inputs used.

Financial instruments measured at fair value

Type Valuation technique

Fixed rates long term borrowings The valuation model considers present value of expected

payments discounted using an appropriate discounting

rate.

Security Deposits The valuation model considers present value of expected

payments discounted using an appropriate discounting

rate.

C) Financial risk management

The Company has exposure to the following risks arising from financial instruments:

•Creditrisk;

•Liquidityrisk;and

•Marketrisk

i) Risk management framework

The Company’s Board of Directors has overall responsibility for the establishment and

oversight of the Company’s Risk Management framework. The Board of Directors have

adopted an Enterprise Risk Management Policy framed by the Company, which identifies

the risk and lays down the risk minimization procedures. The Management reviews the

Risk management policies and systems on a regular basis to reflect changes in market

conditions and the Company’s activities, and the same is reported to the Board of Directors

periodically. Further, the Company, in order to deal with the future risks, has in place various

methods / processes which have been imbibed in its organizational structure and proper

internal controls are in place to keep a check on lapses, and the same are been modified in

accordance with the regular requirements.

The Audit Committee oversees how Management monitors compliance with the

Company’s Risk Management policies and procedures, and reviews the adequacy of the

risk management framework in relation to the risks faced by the Company. The Audit

Committee is assisted in its oversight role by the internal auditors.

ii) Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a

financial instrument fails to meet its contractual obligations, and arises principally from the

Company's receivables from customers and loans and advances.

The carrying amount of following financial assets represents the maximum credit exposure:

Trade receivables and loans and advances.

The Company’s exposure to credit risk is influenced mainly by the individual characteristics

of each customer in which it operates. Credit risk is managed through credit approvals,

establishing credit limits and continuously monitoring the creditworthiness of customers to

which the Company grants credit terms in the normal course of business.



The Risk Management Committee has established a credit policy under which each new

customer is analysed individually for creditworthiness before the Company’s standard

payment and delivery terms and conditions are offered.

For trade receivables, the company individually monitors outstanding balances. Accordingly,

the Company makes specific provisions against such trade receivables wherever required

and monitors the same at periodic intervals.

The Company monitors each loans and advances given and makes any specific provision

wherever required.

The Company establishes an allowance for impairment that represents its estimate of

expected losses in respect of trade receivables and loans and advances.

Impairment:

At March 31, 2018, the ageing of trade receivables was as follows.

Particulars Carrying amount (H in lacs)

March 31, 2018 March 31, 2017 April 1, 2016

Neither past due nor impaired

Past due 1–90 days - 10.50 -

Past due 91–180 days 61.45 - -

Past due 181-365 days - 18.28 -

Past due 366 days 3.28 - -

64.73 28.78 -

Management believes that the unimpaired amounts which are past due are collectible in full.

Cash and cash equivalents and other Bank balances

The Company held cash and cash equivalents and other bank balances of H5.76 lacs as on

March 31, 2018 (March 31, 2017: H9.24 lacs and April 1, 2016: H61.04 lacs). The cash and cash

equivalents are held with banks with good credit ratings.

Loans and Advances:

The Company held Loans and advances of H5,070.66 lacs as on March 31, 2018 (March 31,

2017: H5,438.45 lacs and April 1, 2016: H6,147.48 lacs). The loans and advances are in nature

of advance to subsidiaries and rent deposit paid to landlords and are fully recoverable in the

opinion of the Management.

iii) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations

associated with its financial liabilities that are settled by delivering cash or another financial

asset. The Company’s approach to managing liquidity is to ensure, as far as possible, that

it will have sufficient liquidity to meet its liabilities when they are due, under both normal

and stressed conditions, without incurring unacceptable losses or risking damage to the

Company’s reputation.



iv) Market risk

Market risk is the risk that changes in market prices – such as foreign exchange rates, interest

rates and equity prices – will affect the Company’s income or the value of its holdings

of financial instruments. Market risk is attributable to all market risk sensitive financial

instruments including foreign currency receivables and payables and long term debt. We

are exposed to market risk primarily related to foreign exchange rate risk, interest rate risk

and the market value of our investments. Thus, our exposure to market risk is a function of

investing and borrowing activities and revenue generating and operating activities in foreign

currency. The objective of market risk management is to avoid excessive exposure in our

foreign currency revenues and costs.

(H in Lacs)

March 31, 2018 Carrying

amount

Contractual cash flows

Total less

than 6

months

6-12

months

1-2

years

2-5

years

More

than 5

years

Borrowings 257.13 257.13 250.00 - 5.00 2.13 -

Trade and other payables 31.77 31.77 31.77 - - - -

Other financial liabilities 204.17 204.17 2.00 202.17 - - -

(H in Lacs)


amount


Total less

than 6

months

6-12

months

1-2

years

2-5

years

More

than 5

years

Borrowings 829.29 829.29 620.00 - 204.54 4.75 -



(H in Lacs)

April 1, 2016 Carrying

amount


Total less

than 6

months

6-12

months

1-2

years

2-5 years More

than 5

years

Borrowings 4,224.95 4,224.95 - - 400.00 3,824.95 -

Trade and other

payables

114.89 114.89 114.89 - - - -


The gross inflows/(outflows) disclosed in the above tables represent the contractual

undiscounted cash flows relating to the financial liabilities which are not usually closed out

before contractual maturity.

Maturity profile of financial liabilities

The following are the remaining contractual maturities of financial liabilities at the reporting

date. The amounts are gross and undiscounted, and include estimated interest payments

and exclude the impact of netting agreements.



Currency risk

The Company is not significantly exposed to currency risk. The functional currency of the

Company is Indian Rupee.

Exposure to currency risk (Exposure in different currencies converted to functional currency

i.e. INR)

The currency profile of financial assets and financial liabilities as at 31st March, 2018 are as

below:

March 31, 2018 GBP

Financial assets

Trade and other receivables 66,600

66,600

v) Interest rate risk

Interest rate risk can be either fair value interest rate risk or cash flow interest rate risk. Fair

value interest rate risk is the risk of changes in fair values of fixed interest bearing investments

because of fluctuations in the interest rates. Cash flow interest rate risk is the risk that

the future cash flows of floating interest bearing investments will fluctuate because of

fluctuations in the interest rates.

42 Capital Management For the purpose of the Company's capital management, capital includes issued capital and other

equity reserves. The primary objective of the Company’s Capital Management is to maximise

shareholders value. The Company manages its capital structure and makes adjustments in the

light of changes in economic environment and the requirements of the financial covenants.

The Company monitors capital using debt to equity ratio.(H in Lacs)

Particulars As at

March 31, 2018

As at

March 31, 2017

As at

April 1, 2016

Non-Current Borrowings 7.13 209.29 400.00

Current Borrowings 250.00 620.00 3,824.95

Current maturity of long term debt 202.17 201.97 203.34

Gross Debt 459.30 1,031.26 4,428.29

Total equity 6,273.63 5,912.25 5,447.05

Adjusted Net debt to equity ratio 0.07 0.17 0.81



43 Employee Benefits The Company contributes to the following post-employment defined benefit plans in India.

(i) Defined Contribution Plans:

The contributions to the Provident Fund and Family Pension Fund of certain employees are

made to a Government administered Provident Fund and there are no further obligations

beyond making such contribution.

The Company recognised H4.16 lacs for year ended March 31, 2018 (H3.73 lacs for year

ended March 31, 2017) provident fund contributions in the Statement of Profit and Loss.

The contributions payable to these plans by the Company are at rates specified in the rules

of the schemes.

(ii) Defined Benefit Plan:

Gratuity

The Company participates in the Employees Gratuity scheme, a funded defined benefit

plan for qualifying employees. Gratuity is payable to all eligible employees on death or on

separation / termination in terms of the provisions of the Payment of Gratuity Act, 1972.

The most recent actuarial valuation of plan assets and the present value of the defined

benefit obligation for gratuity were carried out as at March 31, 2018. The present value of the

defined benefit obligations and the related current service cost and past service cost, were

measured using the Projected Unit Credit Method.

(A) (H in Lacs)

Particulars Gratuity


Defined benefit obligation 42.60 34.88 25.60

Fair value of Plan Assets at the end

of the year

24.88 22.62 21.02

Net Obligation at the end of the

year

17.72 12.26 4.58



(B)

Mo

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ticu

lars

Gra

tuit

y

Defi

ned

ben

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ligat

ion

Fair

val

ue

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pla

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arch

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ch 3

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Ap

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ch 3

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.58

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-

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-

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9

.96

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7

.83

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rap

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C) Plan assets

Plan assets comprise the following:

D) Defined benefit obligations

i) Actuarial assumptions

The following were the principal actuarial assumptions at the reporting date (expressed as

weighted averages).

ii) Sensitivity analysis

Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions,

holding other assumptions constant, would have affected the defined benefit obligation by the

amounts shown below.

(H in Lacs)

Particulars March 31, 2018 March 31, 2017 April 1, 2016

Fund managed by Insurance

Company

24.88 22.62 21.02

24.88 22.62 21.02


Discount rate 7.88% 7.36% 7.96%

Expected Rate of Return on Plan

Assets

7.88% 7.36% 7.96%

Salary escalation rate 5% 5% 5%

Employee Turnover 2% 2% 2%

Mortality rate N.A. N.A. N.A.

Indian Assured

Lives Mortality

(2006-08) Ult.

Indian Assured

Lives Mortality

(2006-08) Ult.

Indian Assured

Lives Mortality

(2006-08) Ult.

Assumptions regarding future mortality have been based on published statistics and mortality

tables.

Particulars March 31, 2018 March 31, 2017

Increase Decrease Increase Decrease

Discount rate (1% movement) (2.65) 3.01 (2.60) 2.98

Future salary growth (1% movement) 3.07 (2.75) 3.02 (2.68)

Rate of employee turnover (1% movement) 0.31 (0.37) 0.12 (0.18)

The sensitivity analysis above have been determined based on a method that extrapolates the

impact on defined benefit obligation as a result of reasonable changes in key assumptions

occurring at the end of the reporting period.



Expected future cash flows

The expected future cash flows in respect of gratuity as at March 31, 2018 were as follows

Expected contribution

The expected contributions for defined benefit plan for the next financial year will be in line with

the contribution for the year ended March 31, 2018, i.e. H0.60 lacs

Expected future benefit payments (H in lacs)

March 31, 2019 0.79

March 31, 2020 1.39

March 31, 2021 1.45

March 31, 2022 27.52

March 31, 2023 0.74

Thereafter 51.49


The Compensated Absences is payable to all eligible employees for each day of accumulated

leave on death or on resignation. Compensated Absences debited to Statement of Profit and

Loss during the year amounts to H13.35 lacs (March 31, 2017 H25.21 lacs) and is included in Note

26 - ‘Other Comprehensive Income’. Accumulated non-current provision for leave encashment

aggregates H186.20 lacs (March 31, 2017 H173.79 lacs and April 1, 2016 H155.54 lacs) and current

provision aggregates H16.20 lacs (March 31, 2017 H15.98 lacs and April 1, 2016 H14.94 lacs).

44 Earnings per share (EPS) Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders

of the Company by the weighted average number of Equity shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the profit attributable to equity holders of the

Company by the weighted average number of Equity shares outstanding during the year plus the

weighted average number of Equity shares that would be issued on conversion of all the dilutive

potential Equity shares into Equity shares.

a) Profit attributable to Equity holders of Company (H in Lacs)


Continuing operations 347.20 (690.97)

Profit attributable to equity holders of the

Company for basic earnings

347.20 (690.97)


Company adjusted for the effect of dilution

347.20 (690.97)


Issued ordinary shares at April 1 2,65,15,325 2,64,73,525

Effect of shares issued for cash - 41,800

Weighted average number of shares at March 31

for basic and Diluted EPS

2,65,15,325 2,65,15,325

b) Weighted average number of ordinary shares




Basic earnings per share 1.31 (2.61)

Diluted earnings per share 1.31 (2.61)

c) Basic and Diluted earnings per share

45 First-time adoption of Ind AS A) Transition to Ind AS

For the purposes of reporting as set out in Note 27, the Company has transitioned the

basis of accounting from Indian generally accepted accounting principles (“IGAAP”) to Ind

AS. The accounting policies set out in note 27 have been applied in preparing the financial

statements for the year ended March 31, 2018, the comparative information presented in

these financial statements for the year ended March 31, 2017 and in the preparation of an

opening Ind AS balance sheet at April 1, 2016 (the “transition date”).

In preparing the opening Ind AS balance sheet as at April 1, 2016 and in presenting the

comparative information for the year ended March 31, 2017, the Company has adjusted

amounts reported in financial statements prepared in accordance with IGAAP. An explanation

of how the transition from IGAAP to Ind AS has affected the financial performance, cash

flows and financial position is set out in the following tables and the notes that accompany

the tables. On transition, the Company did not revise estimates previously made under

IGAAP except where required by Ind AS.

B) Exemptions and exceptions availed

1) Ind AS mandatory exceptions

1.1) Estimates

The estimates at April 1 2016 and March 31 2017 are consistent with those made for

the same dates in accordance with the Indian GAAP (after adjustments to reflect

any differences if any, in accounting policies). The Company has made estimates

for following items in accordance with Ind AS at the date of transition as these were

not required under IGAAP:

1) Investment in equity instruments carried at FVTPL;

1.2) Classification and measurement of financial assets

The Company has classified and measured the financial assets on the basis of the

facts and circumstances that exist at the date of transition to Ind AS.

2) Ind AS optional exemptions

2.1) Deemed cost

The Company has elected to continue with the carrying value for all of its property,

plant and equipment, intangible assets recognised in the financial statements as the

deemed cost at the date of transition to Ind AS, measured as per the IGAAP

2.2) Deemed cost for investments in subsidiaries and Joint Ventures

The Company has elected to continue with the carrying value of its investments in

subsidiaries as recognised in the financial statements as at the date of transition to

Ind AS.

Accordingly, the Company has measured all its investments in subsidiaries at their

IGAAP carrying value.



C) Reconciliation between IGAAP and Ind AS:

Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for

prior periods. The following table represent the reconciliation from IGAAP to Ind AS

I) Reconciliation of equity as at April 1, 2016 (H in Lacs)

Particulars Footnote No.

Amount as per IGAAP

Effects of transition to Ind AS

Amount as per Ind

AS

ASSETS

1) Non-current assets

(a) Property, Plant and Equipment 285.69 - 285.69

(b) Capital work-in-progress - - -

(c) Other Intangible assets 0.18 - 0.18

(d) Financial Assets

(i) Invesments in Subsidiaries 848.00 - 848.00

(ii) Investments 2 3,865.23 (1,194.65) 2,670.58

(e) Non-Current Advance Tax Assets (Net) 169.73 - 169.73

(f) Other non-current assets 19.93 - 19.93

Total non current assets 5,188.76 (1,194.65) 3,994.11

2) Current Assets


(i) Investments 2 17.80 11.85 29.65

(ii) Trade Receivables - - -

(iii) Cash and Cash Equivalents 61.04 - 61.04

(iv) Loans 6,143.90 - 6,143.90

(v) Other Financial Assets 3.58 - 3.58

(b) Other current assets 8.32 - 8.32

Total current assets 6,234.64 11.85 6,246.49

TOTAL ASSETS 11,423.40 (1,182.80) 10,240.60


1) Equity

(a) Equity share capital 1,327.85 - 1,327.85

(b) Other equity 2 5,301.99 (1,182.80) 4,119.19

Total Equity 6,629.84 (1,182.80) 5,447.04

2) Non current liabilities

(a) Financial liabilities

(i) Borrowings 400.00 - 400.00

(b) Provisions 155.54 - 155.54

Total non current liabilities 555.54 - 555.54

3) Current liabilities


(i) Borrowings 3,824.95 - 3,824.95

(ii) Trade payables 114.89 - 114.89

(iii) Other financial liabilities 203.34 - 203.34

(b) Other current liabilities 75.31 - 75.31

(c) Provisions 19.53 - 19.53

Total Current liabilities 4,238.01 - 4,238.01

Total liabilities 4,793.56 - 4,793.56

TOTAL EQUITY AND LIABILITIES 11,423.40 (1,182.80) 10,240.60



II) Reconciliation of equity as at March 31, 2017 (H in Lacs)

Particulars Footnote

No.

Amount

as per

IGAAP

Effects of

transition

to Ind AS

Amount

as per Ind

AS

ASSETS






(i) Invesments in Subsidiaries 848.00 - 848.00

(ii) Investments 2 614.09 (568.35) 45.74

(e) Non-Current Advance Tax Assets (Net) 168.59 - 168.59


Total non current assets 2,269.36 (568.35) 1,701.01

2) Current Assets


(i) Investments 14.68 - 14.68

(ii) Trade Receivables 28.78 - 28.78


(iv) Loans 5,434.87 - 5,434.87

(v) Other Financial Assets 3.58 - 3.58


Total current assets 5,509.55 - 5,509.55

TOTAL ASSETS 7,778.91 (568.35) 7,210.56


1) Equity


(b) Other equity 2 5,150.67 (568.35) 4,582.32

Total Equity 6,480.61 (568.35) 5,912.26



(i) Borrowings 209.29 - 209.29

(b) Provisions 173.79 - 173.79




(i) Borrowings 620.00 - 620.00




(c) Provisions 28.22 - 28.22

Total Current liabilities 915.23 - 915.23


TOTAL EQUITY AND LIABILITIES 7,778.91 (568.35) 7,210.56



III) Reconciliation of Profit & Loss Account as on March 31, 2017 (H in Lacs)


No.

Amount

as per

IGAAP

Effects of

transition

to Ind AS

Amount

as per Ind

AS

I. Revenue from Operations (Gross) 463.00 - 463.00

II. Other income 213.60 - 213.60

III. Total Revenue (I+II) 676.60 - 676.60

IV. Expenses

Employee Benefits Expenses 1 151.40 (32.89) 118.51

Finance costs 0.87 - 0.87

Depreciation and Amortization Expenses 12.68 - 12.68

Other Expenses 2 193.59 568.35 761.94

Total Expenses 358.54 535.46 894.00

V. Profit/(loss) before Exceptional Items

and taxes

318.06 (535.46) (217.41)

VI. Exceptional Items (473.56) - (473.56)

VII. Profit/(loss) before Tax (155.50) (535.46) (690.97)

VIII. Tax expense:

1. Current Tax - - -

2. Deferred Tax - - -

3. Tax for Earlier years - - -

IX. Profit/(Loss) for the period from

continuing operations

(155.50) (535.46) (690.97)

X. Profit/(Loss) for the period (155.50) (535.46) (690.97)

XI. Other comprehensive income

A (i) Items that will not be reclassified to

profit or loss

Remeasurements of defined benefit

liability (asset)

1 (32.89) (32.89)

B (i) Items that will be reclassified to

profit or loss

Effective portion of (Loss)/Gain on

hedgeing instrument in a cash flow hedge

Other comprehensive income (net of tax) - -

XII. Total comprehensive income for the

period

(155.50) (568.35) (723.86)

1) Actuarial gain and loss

Under Ind AS, all actuarial gains and losses are recognised in other comprehensive income.

Under IGAAP the Company recognised actuarial gains and losses in profit and loss. However

this has no impact on the total comprehensive income and total equity as on 1 April 2016 or



as on 31 March 2017. The Employee Benefit Expenses and Other Comprehensive Income

were reduced by H32.89 lacs each.

2) Fair Valuation of Investments

Under IGAAP, Non-Current Investments (including Investments in Subsidiaries) were carried

at cost less provision, if any, for diminution which is considered other than temporary in

nature. Current Investments were valued at lower of cost and fair value. Under Ind AS,

these Investment are measured at fair value. The resulting fair value of changes of these

investments have been recognised in the retained earnings as at the day of transition and

subsequently in the profit or loss for the year ended March 31, 2017

IV) Adjustments to Statement of Cash Flows

There were no material diffrences between the statement of Cash Flows presented under

Ind AS and IGAAP



To,

The Members of


Report on Consolidated Ind AS Financial

Statements

We have audited the accompanying

consolidated Ind AS financial statements of

Prime Securities Limited (hereinafter referred to

as the `Holding Company`) and its subsidiaries

and associate (the Holding Company and

its subsidiaries together referred to as `the

Company` or `the Group`), comprising of the

Consolidated Balance Sheet as at 31 March

2018, the Consolidated Statement of Profit and

Loss (including Other Comprehensive Income),

the Consolidated Cash Flow Statement and

Consolidated Statement of Changes in Equity

for the year then ended, and a summary of

the significant accounting policies and other

explanatory information (hereinafter referred

to as the `consolidated Ind AS financial

statements).

Management’s Responsibility for the

Consolidated Ind AS Financial Statements

The Holding Company’s Board of Directors

is responsible for the preparation of these

consolidated Ind AS financial statements in

terms of the requirements of the Companies

Act, 2013 (hereinafter referred to as the

`Act`) that give a true and fair view of the

consolidated financial position, consolidated

financial performance including other

comprehensive income, consolidated cash

flows and consolidated changes in the equity of

the Group in accordance with the accounting

principles generally accepted in India, including

the Indian Accounting Standards specified

in Companies (Indian Accounting Standards)

Rules, 2015 (as amended) specified under

section 133 of the Act. The respective Board

of Directors of the companies included in the

Group are responsible for maintenance of

adequate accounting records in accordance

with the provisions of the Act for safeguarding

of the assets of the Group and for preventing

and detecting frauds and other irregularities;

the selection and application of appropriate

accounting policies; making judgments and

estimates that are reasonable and prudent; and

the design, implementation and maintenance of

adequate internal financial controls, that were

operating effectively for ensuring the accuracy

and completeness of the accounting records,

relevant to the preparation and presentation of

the consolidated Ind AS financial statements

that give a true and fair view and are free from

material misstatement, whether due to fraud or

error, which have been used for the purpose of

preparation of the consolidated Ind AS financial

statements by the Directors of the Holding

Company, as aforesaid.

Auditor’s Responsibility

Our responsibility is to express an opinion on

the consolidated Ind AS financial statements

based on our audit.

While conducting the audit, we have taken

into account the provisions of the Act, the

accounting and auditing standards and matters

which are required to be included in the audit

report under the provisions of the Act and the

Rules made thereunder.

We conducted our audit of the consolidated Ind

AS financial statements in accordance with the

Standards on Auditing specified under section

143(10) of the Act. Those standards require that



assurance about whether the consolidated Ind

AS financial statements are free from material

misstatement.

An audit involves performing procedures to

obtain audit evidence about the amounts

and the disclosures in the consolidated Ind

AS financial statements. The procedures

selected depend on the auditor’s judgment,

including the assessment of the risks of

material misstatement of the consolidated Ind

AS financial statements, whether due to fraud

Independent Auditor's Report on Consolidated Financial Statements


or error. In making those risk assessments,

the auditor considers internal financial control

relevant to the Holding Company’s preparation

of the consolidated Ind AS financial statements

that give a true and fair view in order to design

audit procedures that are appropriate in the

circumstances. An audit also includes evaluating

the appropriateness of the accounting policies

used and the reasonableness of the accounting

estimates made by the Holding Company’s

Board of Directors, as well as evaluating the

overall presentation of the consolidated Ind AS

financial statements.

We believe that the audit evidence obtained by

us and the audit evidence obtained by other

auditors in terms of their reports referred to

in sub-paragraphs 1 & 2 of the Other Matter

paragraph below, is sufficient and appropriate

to provide a basis for our audit opinion on the

consolidated Ind AS financial statements.

Basis for Qualified Opinion

1. As referred in Note 32, the Group has

written-back an outstanding payable

of H219.07 Lacs as in the opinion of the

management the same was no longer

payable. Accordingly, the profit for the

year is higher by the said amount and

Other Current Liabilities is lower by the said

amount.

2. As referred in Note 33, the Group has

written-back H327.50 Lacs which was

written-off as not recoverable in the earlier

financial year as in the opinion of the

management the same is now recoverable.

Accordingly, the loss in Surplus (Profit &

Loss) under Other Equity is lower and the

Other Non-Current Assets is higher, by the

said amount.

Qualified Opinion

In our opinion and to the best of our information

and according to the explanations given to us,

except for the effects of the matters described

in point nos. 1 & 2 of the Basis for Qualified

Opinion paragraph, the aforesaid consolidated

Ind AS financial statements give the information

required by the Act in the manner so required

and give a true and fair view in conformity with

the accounting principles generally accepted

in India, of the consolidated state of affairs

of the Group as at 31 March 2018, and their

consolidated total comprehensive income

(comprising of consolidated profit for the

year and consolidated other comprehensive

income), their consolidated cash flows and

consolidated changes in equity for the year

ended on that date.

Other Matters

1. We did not audit the financial statements

of the subsidiaries, whose audited

financial statements reflect total assets of

H1,137.79 Lacs as at March 31, 2018 and

total revenue of H1,520.76 Lacs, total net

profit after tax of H1,083.29 Lacs and total

comprehensive income of H (1,082.64)

Lacs for the year ended on that date,

as considered in the consolidated Ind

AS financial statements. These audited

financial statements and other financial

information for these subsidiaries has been

audited by other auditors whose reports

have been furnished to us, and our opinion

on the accompanying consolidated Ind AS

financial statements is based solely on the

reports of the other auditors.

2. We did not audit the financial statements

of an associate, whose unaudited financial

statements reflect the Group’s share of

profit/ (loss) of H (2.35) Lacs for the year

ended March 31, 2018. These financial

statements and other financial information

for the associate have been prepared

by the management and our opinion

on the accompanying consolidated Ind

AS financial statements is based solely

on such management certified financial

statements/information.

Report on Other Legal and Regulatory

Requirements

1. As required by section 143(3) of the Act, we

report, to the extent applicable, that:

(a) We have sought and obtained all the

information and explanations which to

the best of our knowledge and belief

were necessary for the purposes of


our audit of the aforesaid consolidated

Ind AS financial statements;

(b) In our opinion, proper books of

account as required by law relating

to preparation of the aforesaid

consolidated Ind AS financial

statements have been kept so far as it

appears from our examination of those

books and report of other auditors;

(c) The consolidated balance sheet, the

consolidated statement of profit and

loss (including other comprehensive

income), the consolidated cash flow

statement and consolidated statement

of changes in equity dealt with by

this Report are in agreement with the

relevant books of account maintained

for the purpose of preparation of

the consolidated Ind AS financial

statements;

(d) In our opinion,except for the effects of

the matters described in point nos. 1

& 2 of the Basis for Qualified Opinion

paragraph, the aforesaid consolidated

Ind AS financial statements comply

with the Accounting Standards

specified under section 133 of the

Act, read with relevant rules issued

thereunder.

(e) On the basis of the written

representations received from the

directors of the Holding Company as

on 31 March 2018 taken on record

by the Board of Directors of the

Holding Company and the report of

the statutory auditors of its subsidiary

companies incorporated in India,

none of the Directors of the Group

companies incorporated in India is

disqualified as on 31 March 2018 from

being appointed as a Director of that

company in terms of section 164(2) of

the Act.

(f) With respect to the adequacy of

the internal financial controls over

financial reporting of the Group and

the operating effectiveness of such

controls, refer to our separate report in

“Annexure A”.

(g) With respect to the other matters to

be included in the Auditor’s Report

in accordance with Rule 11 of the

Companies (Audit and Auditors) Rules,

2014, in our opinion and to the best of

our information and according to the

explanations given to us and based on

the consideration of the report of the

other auditors on separate financial

statements of subsidiaries as noted in

‘Other Matter’ paragraph:

i) The consolidated Ind AS financial

statements disclose the impact

of pending litigations on the

consolidated Ind AS financial

position of the group– Refer Note

No. 29 to the consolidated Ind AS

financial statements;

ii) The Company has made provision,

as required under the applicable

law or accounting standards, for

material foreseeable losses, if any,

on long-term contracts including

derivative contracts;

iii) There has been no delay in

transferring amounts required

to be transferred to the Investor

Education and Protection Fund by

the Group;

iv. The reporting on disclosures

relating to Specified Bank Notes is

not applicable for the year ended

31 March 2018.



(FRN: 102965W/W100192)

[MILIND GANDHI]

Mumbai, Partner



In conjunction with our audit of the consolidated

Ind AS financial statements of the Company

as of and for the year ended 31 March 2018,

we have audited the internal financial controls

over financial reporting of Prime Securities

Limited (hereinafter referred to as “the Holding

Company”) and its subsidiary companies which

are companies incorporated in India, as of that

date.

Management’s Responsibility for Internal

Financial Controls

The Respective Board of Directors of

the Holding Company and its subsidiary

companies, which are companies incorporated

in India, are responsible for establishing and

maintaining internal financial controls based


criteria established by the Group considering




issued by the Institute of Chartered Accountants

of India (“ICAI’). These responsibilities include

the design, implementation and maintenance

of adequate internal financial controls that

were operating effectively for ensuring the

orderly and efficient conduct of its business,

including adherence to company’s policies, the

safeguarding of its assets, the prevention and

detection of frauds and errors, the accuracy

and completeness of the accounting records,

and the timely preparation of reliable financial

information, as required under the Companies

Act, 2013.

Auditors’ Responsibility

Our responsibility is to express an opinion

on the Company's internal financial controls

over financial reporting based on our audit.

We conducted our audit in accordance

with the Guidance Note on Audit of Internal


(the “Guidance Note”) issued by ICAI and

the Standards on Auditing, issued by ICAI

and deemed to be prescribed under section

143(10) of the Companies Act, 2013, to the

extent applicable to an audit of internal

financial controls, both issued by the Institute

of Chartered Accountants of India. Those

Standards and the Guidance Note require that



assurance about whether adequate internal

financial controls over financial reporting was

established and maintained and if such controls

operated effectively in all material respects.

Our audit involves performing procedures to

obtain audit evidence about the adequacy of the


reporting and their operating effectiveness. Our

audit of internal financial controls over financial

reporting included obtaining an understanding

of internal financial controls over financial

reporting, assessing the risk that a material

weakness exists, and testing and evaluating

the design and operating effectiveness of

internal control based on the assessed risk. The

procedures selected depend on the auditor’s

judgment, including the assessment of the

risks of material misstatement of the financial

statements, whether due to fraud or error.

We believe that the audit evidence obtained by

us and the audit evidence obtained by other

auditors in terms of their reports referred to in

the Other Matters paragraph below is sufficient

and appropriate to provide a basis for our audit

opinion on the Company’s internal financial

controls system over financial reporting.

Meaning of Internal Financial Controls over

Financial Reporting

A company's internal financial control over

financial reporting is a process designed

Annexure - A to the Auditor's Report

Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the

Companies Act, 2013 (“the Act”)


to provide reasonable assurance regarding

the reliability of financial reporting and the

preparation of financial statements for external

purposes in accordance with generally

accepted accounting principles. A company's

internal financial control over financial reporting

includes those policies and procedures that:

(1) pertain to the maintenance of records that,

in reasonable detail, accurately and fairly

reflect the transactions and dispositions of

the assets of the company;

(2) provide reasonable assurance that

transactions are recorded as necessary to

permit preparation of financial statements

in accordance with generally accepted

accounting principles, and that receipts

and expenditures of the company are

being made only in accordance with

authorisations of management and

directors of the company; and

(3) provide reasonable assurance regarding

prevention or timely detection of

unauthorised acquisition, use, or disposition

of the company's assets that could have a

material effect on the financial statements.

Inherent Limitations of Internal Financial

Controls Over Financial Reporting

Because of the inherent limitations of internal

financial controls over financial reporting,

including the possibility of collusion or improper

management override of controls, material

misstatements due to error or fraud may occur

and not be detected. Also, projections of any

evaluation of the internal financial controls over

financial reporting to future periods are subject

to the risk that the internal financial control over

financial reporting may become inadequate

because of changes in conditions, or that the

degree of compliance with the policies or

procedures may deteriorate.

Opinion

In our opinion, the Holding Company and its

subsidiary companies, which are companies

incorporated in India, have, in all material

respects, an adequate internal financial controls

system over financial reporting and such internal

financial controls over financial reporting were

operating effectively as at 31 March 2018, based


criteria established by the Company considering



Financial Controls Over Financial Reporting

issued by the ICAI.



(FRN: 102965W/W100192)

[MILIND GANDHI]

Mumbai, Partner



(H in Lacs)

Particulars Note No.

As at 31-Mar-18

As at 31-Mar-17

As at 1-Apr-16

ASSETS

1. Non-Current Assets

(a) Property, Plant & Equipment 1 284.60 291.23 285.69

(b) Other Intangible assets 1 1.21 0.02 0.18

(c) Financial Assets

i) Investments 2 136.17 151.87 3,148.92

(d) Deferred Tax Assets 89.23 - -

(e) Non-Current Advance tax Assets (Net) 96.57 - 176.62

(f) Other Non-Current Assets 3 356.33 347.43 19.93

Total Non-Current Assets 964.11 790.55 3,631.34

2. Current Assets


i) Investments 4 28.10 36.72 29.65

ii) Trade Receivables 5 129.63 428.88 -

iii) Cash & Cash Equivalents 6 10.74 285.72 67.43

iv) Bank Balance other than (iii) above 7 525.00 435.35 396.46

v) Loans 8 200.00 - 162.84

vi) Other Financial Assets 9 140.45 146.71 1,296.20

(b) Other Current Assets 10 169.77 118.89 1,065.52

Total Current Assets 1,203.69 1,452.27 3,018.10

Total Assets 2,167.80 2,242.82 6,649.44


1. Equity

(a) Equity Share capital 11 1,329.94 1,329.94 1,327.85

(b) Other Equity 12 (317.83) (1,761.85) (4,763.58)

Total Equity 1,012.11 (431.91) (3,435.73)

2. Non-Current Liabilities


i) Borrowings 13 7.13 209.29 400.00

(b) Provisions 14 193.99 181.23 155.54

Total Non-Current Liabilities 201.12 390.52 555.54

3. Current Liabilities


i) Borrowings 15 587.36 1,285.00 8,292.06

ii) Trade Payables 16 34.15 54.75 116.93

iii) Other Financial Liabilities 17 204.17 201.97 203.34

(b) Other current liabilities 18 94.11 378.78 897.77

(c) Provisions 19 34.78 28.99 19.53

(d) Current tax liabilities (Net) - 334.72 -

Total Current Liabilities 954.57 2,284.21 9,529.63

Total Equity and Liabilities 2,167.80 2,242.82 6,649.44

Consolidated Balance Sheet as at March 31, 2018

Significant accounting policies Note no. 28The notes referred to above form an integral part of the consolidated financial statements.


For and on behalf ofGANDHI & ASSOCIATES LLP N. Jayakumar Pradip Dubhashi Anil DharkerChartered Accountants Managing Director Chairman Director (FRN: 102965W/W100192)

Milind Gandhi S. R. Sharma Alpana Parida Ajay ShahPartner Director Director Company SecretaryMembership No. 043194



Significant accounting policies Note no. 28

The notes referred to above form an integral part of the consolidated financial statements.





(FRN: 102965W/W100192)





(H in Lacs)

Particulars Note

No.

Year ended

31-Mar-18

Year ended

31-Mar-17

I. Revenue from Operations 20 2,311.42 1,695.50

II. Other Income 21 91.05 262.15

III. Total Income (I+II) 2,402.47 1,957.65

IV. Expenses

Employee benefits expenses 22 354.31 138.46

Finance cost 23 1.87 2.22

Depreciation and amortization expenses 1 14.97 12.68

Other expenses 24 421.04 919.11

Total Expenses 792.19 1,072.47

V. Profit / (loss) before exceptional items and tax (III -IV) 1,610.28 885.18

VI. Exceptional Items 25 104.71 1,049.66

VII. Profit / (loss) before tax ( V + VI ) 1,714.99 1,934.84

VIII. Tax expense:

Current tax 26 373.10 593.53

Deferred tax (89.23) -

Tax from earlier years 0.64 -

IX. Profit / (loss) for the year (VII - VIII) 1,430.48 1,341.31

X. Other Comprehensive Income

Items that willl not be reclassified to profit or loss

Remeasurement of defined benefit liability 27 (19.71) (41.10)

Income tax effect on above 4.02 1.67

XI. Total Comprehensive Income for the period (IX + X)

(Comprising Profit / (loss) and other comprehensive

income for the period)

1,414.79 1,301.88

XII. Earnings per Equity Share

Basic 5.39 5.06

Diluted 5.39 5.06

Consolidated Statement of Profit & Loss for the year ended March 31, 2018


(a) Equity Share Capital (H in Lacs)

Particulars As at 31st March, 2018 As at 31st March, 2017

No. of Shares

Amount No. of Shares

Amount

Balance at the Beginning of the Reporting Period 2,65,15,325 1,329.94 2,64,73,525 1,327.85

Changes in Equity Share Capital during the Year - - 41,800 2.09

Balance at the End of the Reporting Period 2,65,15,325 1,329.94 2,65,15,325 1,329.94

(b) Other Equity (H in Lacs)

Particulars Reserves and Surplus Items of Other

Comprehensive

Income

Total

Capital

Reserve

Capital

Redemption

Reserve

Securities

Premium

Reserve

Share Options

outstanding

account

General

Reserve

Retained

Earnings

Remeasurements

of the net defined

benefit plans

Balance at April 1, 2016 165.00 217.27 5,312.64 - 2,400.00 (11,162.80) - (3,067.89)

Profit for the year - - - - - 1,341.31 - 1,341.31

Actuarial gain / (Loss) on defined

benefit plan

- - - - - - (39.43) (39.43)

Other comprehensive income for

the year

- - - - - - (39.43) (39.43)

Total comprehensive income for

the year

- - - - - 1,341.31 (39.43) 1,301.88

Received on Issue of Shares - - 4.18 - - - - 4.18

Balance at March 31, 2017 165.00 217.27 5,316.82 - 2,400.00 (9,821.49) (39.43) (1,761.85)

Profit for the year - - - - - 1,430.48 - 1,430.48

Share based payment to employees - - - 29.22 - - - 29.22

Actuarial gain / (Loss) on defined

benefits plan net of tax

- - - - - - (15.69) (15.69)

Other comprehensive income for

the year

- - - - - - (15.69) (15.69)

Total comprehensive income for

the year

- - - - - - (15.69) (15.69)

Balance at March 31, 2018 165.00 217.27 5,316.82 29.22 2,400.00 (8,391.01) (55.12) (317.83)

Consolidated Statement of Changes in Equity (SOCIE) for the year ended March 31, 2018





(FRN: 102965W/W100192)






Consolidated Cash Flow Statement for the year ended March 31, 2018

(H in Lacs)

INFLOWS/(OUTFLOWS)

Year ended

31-Mar-18

Year ended

31-Mar-17

A CASH FLOW FROM OPERATING ACTIVITIES

Net Profit / (Loss) before tax from continuing

operations

1,695.28 1,893.74

Adjustments for :

Interest Received (37.43) (35.71)

Depreciation 14.97 12.68

Interest & Finance Charges 1.87 2.22

Loss / (Gain) on Sale of Investments (Net) (4.14) (220.84)

Amount Written-back (302.40) (5,645.83)

Balances written off 197.69 4,596.17

(Appreciation) / Dimunition in value of Investments 23.07 710.01

Provision for outstanding ESOS 29.22 -

(77.15) (581.30)

Operating Profit / (Loss) before Working Capital

changes

1,618.13 1,312.44

Adjustments for Changes in the Working Capital

Debtors 299.25 (428.88)

Current Assets (59.78) (92.17)

Loans & Advances (393.87) (41.52)

Current Liabilities & Provisions (11.89) 74.68

(166.29) (487.89)

Cash generated from Operations 1,451.84 824.55

Direct Taxes (Paid) / Refund (net) (800.99) (80.54)

Net Cash from Operating Activities (A) 650.85 744.01

B CASHFLOW FROM INVESTMENT ACTIVITIES

Purchase of Investments - (34.00)

Purchase of Fixed Assets (9.53) (18.06)

Sale of Investments 5.39 2,061.12

Interest Received 37.43 35.71

Net Cash from Investment Activities (B) 33.29 2,044.77


Consolidated Cash Flow Statement for the year ended March 31, 2018

(H in Lacs)

INFLOWS/(OUTFLOWS)

Year ended

31-Mar-18

Year ended

31-Mar-17

C CASHFLOW FROM FINANCING ACTIVITIES

Interest & Finance Charges (1.87) (2.22)

Proceeds from issue of shares (ESOS) - 6.26

Application Money against warrants 2.00 -

Funds Borrowed / (Repaid) (net) (869.61) (2,535.65)

Net Cash from Financing Activities (C) (869.48) (2,531.61)

Net Cashflow (A + B + C) (185.34) 257.17

Changes in the Cash & Bank Balances (185.34) 257.17

Cash and Cash Equivalents at the beginning of the year 721.07 463.90

Cash and Cash Equivalents at the end of the year 535.74 721.07





(FRN: 102965W/W100192)





Notes to the cash flow statement

1 Cash Comprises Cash on Hand and Current Accounts with Banks.

2 The Cash Flow statement has been prepared under the "Indirect Method" as set out in Indian

Accounting Standard *(Ind AS-7) Statement of Cash Flows.

3 Previous year's figures have been regrouped / recasted wherever necessary.


Notes to Consolidated Financial Statement for the year ended March 31, 2018

1 - Property, Plant and Equipment (H in Lacs)

Particulars Tangible Intangible

Building Furniture & Fixture

Office Equipments


Total

Gross Block


Additions - 0.90 0.29 15.54 1.34 18.07 - -


Disposals - - - - - - - -



Additions - 3.02 2.57 - 2.70 8.29 1.24 1.24


Disposals - - - - - - - -


Depreciation:

Balance as at 1st April 2016 - - - - - - - -

Change for the year 6.56 2.02 0.57 2.81 0.57 12.53 0.16 0.16


Disposals - - - - - - - -



Change for the year 6.55 2.13 0.66 4.33 1.25 14.92 0.05 0.05


Disposals - - - - - - - -


Net Block: - -

As at 31st March, 2017 253.52 11.04 1.33 23.81 1.53 291.23 0.02 0.02

As at 31st March, 2018 246.97 11.93 3.24 19.48 2.98 284.60 1.21 1.21

Deemed Cost as on 1st April 2016 (H in Lacs)

Particulars Building Furniture & Fixture

Office Equipments


Total

Gross Block 392.80 19.79 4.63 126.89 2.99 547.10 1.29 1.29

Less ; Accumulated Depreciation 132.72 7.63 3.02 115.81 2.23 261.41 1.11 1.11

Net Block 260.08 12.16 1.61 11.08 0.76 285.69 0.18 0.18

Note:1. Net block of the Building include a residential flat of H246.97 lacs in a co-operative society, acquired

from a debtor in satisfaction of a claim. In view of the restraining orders, the society has kept in abeyance the admission of membership of the Company. In the earlier year, pursuant to the order of the Hon’ble High Court, the possession of the flat was handed over to the Official Assignee. An appeal was filed by the Company against the said order whereby the said order was set aside. Pursuant to the fresh chamber summons filed by the Company for removing attachment, the Official Assignee has been directed not to sell or dispose-off the flat. The Company has been legally advised that the said developments will not have a bearing on the Company’s title to the flat and consequently there is no impairment in the value of the asset and the Company is not likely to have any further claim or liability against the said flat.

2. The Company has availed the deemed cost exemption in relation to the property plant and equipment on the date of transition and hence the net block carrying amount has been considered as the gross block carrying amount on that date. Refer note below for the gross block value and the accumulated depreciation on April 1, 2016 under the previous GAAP.



2 - Investments (H in Lacs)

As at

31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

In Other Companies (Non-Trade)


I) Quoted, Fully Paid-up 136.17 151.87 603.86

II) Unquoted, Fully Paid-up 200.00 200.00 2,745.06

336.17 351.87 3,348.92

Less: Impairment in Value of Investments 200.00 200.00 200.00

Total 136.17 151.87 3,148.92

3 - Other Non-Current Assets (H in Lacs)

As at

31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Unsecured, Considered good


i) Security Deposit 28.83 19.93 19.93

ii) Advance Given 327.50 327.50 -

Total 356.33 347.43 19.93

4 - Current Investments (H in Lacs)

As at

31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

In Other Companies


Quoted, Fully Paid-up. 28.10 36.72 29.65

Total 28.10 36.72 29.65

5 - Trade Receivables (H in Lacs)

As at

31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Unsecured, Considered Good 129.63 428.88 -

Total 129.63 428.88 -



8 - Current Loans (H in Lacs)

As at

31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Unsecured, Considered Good

Loans to related parties

Associate Company 200.00 - 162.84

Total 200.00 - 162.84

10 - Other Current Assets (H in Lacs)

As at

31-Mar-18

As at

31-Mar-17

As at

1-Apr-16


Prepaid Expenses 11.69 11.93 5.69

Other Advances 158.08 106.96 1,059.83

Total 169.77 118.89 1,065.52

6 - Cash and Cash Equivalents (H in Lacs)

As at

31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Cash on Hand 0.67 1.02 8.56

Balance with Banks in Current Accounts 10.07 284.70 58.87

Total 10.74 285.72 67.43

9 - Other Current Financial Assets (H in Lacs)

As at

31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Interest receivable 6.97 5.27 5.38

Other Receivables 133.48 141.44 1,290.82

Total 140.45 146.71 1,296.20

7 - Bank Balances other than Cash and Cash Equivalents (H in Lacs)

As at

31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Bank Deposits with 3-12 months original maturity 525.00 435.35 396.46

Total 525.00 435.35 396.46


11 - Equity Share Capital (H in Lacs)

As at

31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Authorised

3,50,00,000 (March 31, 2017 3,00,00,000, April 1,


1,750.00 1,500.00 1,500.00

Nil (March 31, 2017 2,00,000, April 1, 2016

2,00,000) 13% Cumulative Redeemable

Preference Shares of H100/- each

- 200.00 200.00

18,00,000 (March 31, 2017 18,00,000, April 1, 2016

18,00,000) Unclassified Shares of H100/- each

1,800.00 1,800.00 1,800.00

Total 3,550.00 3,500.00 3,500.00

Issued

2,72,64,525 (March 31, 2017 2,72,64,525 April 1,


1,363.23 1,363.23 1,361.14

Total 1,363.23 1,363.23 1,361.14

Subscribed & Fully Paid-up

2,65,15,325 (March 31, 2017 2,65,15,325 April 1,


1,325.77 1,325.77 1,323.68

Add : Share Forfeiture Account [7,48,600 Equity

Shares forfeited]

4.17 4.17 4.17

(Refer Note no 35)

Total 1,329.94 1,329.94 1,327.85


As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

(a) Capital Reserve

The Reserve comprises of Profits / Gains of

Capital nature earned by the Company and

credited directly to such Reserve

At the commencement and at the end of the

year 165.00 165.00

Total 165.00 165.00 165.00

(b) Capital Redemption Reserve

As per the Companies Act, 2013, the Capital

Redemption Reserve is created when the

Company purchases its own Shares out of Free

Reserves or Securities Premium. A sum equal to

the Nominal Value of the Shares so purchased

is transferred to Capital Redemption Reserve

At the commencement and at the end of the

year 217.27 217.27

Total 217.27 217.27 217.27




As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

(c) Securities Premium Reserve

Securities Premium is used to record the premium on issue of Shares. The Reserve is utilised in accordance with the provisions of the Companies Act, 2013

At the commencement of the year 5,316.82 5,312.64

Add: Received during the year - 4.18

Total 5,316.82 5,316.82 5,312.64

(d) Share Options outstanding account

The amount is provided on determination of fair value of options in accordance with requirements of Ind AS 102

At the commencement of the year - -

Add: Provided during the year 29.22 -

Total 29.22 - -

(e) General Reserve

General Reserve forms part of the Retained Earnings and is permitted to be distributed to Shareholders as part of Dividend

At the commencement and at the end of the year 2,400.00 2,400.00

Total 2,400.00 2,400.00 2,400.00

(f) Surplus

At the commencement of the year (9,821.50) (12,858.49)

Add: Adjustment due to Restatement on fair value of Investments

- 1,695.68

Add: Net Profit / (Loss) for the Year 1,430.48 1,341.31

Total (8,391.02) (9,821.50) (12,858.49)

(g) Items of Other Comprehensive Income

Remeasurement of defined benefit liability

At the commencement of the year (39.43) -

Add : Remeasurement of defined benefit liability

(15.69) (39.43)

Total (55.12) (39.43) -

Total Other Equity (317.83) (1,761.85) (4,763.58)

13 -Borrowings - Non-Current Liabilities (H in Lacs)

As at

31-Mar-18

As at

31-Mar-17

As at

1-Apr-16



Term Loan from Bank 7.13 9.29 -

Other Loan from Bank - 200.00 400.00

Total 7.13 209.29 400.00



15 - Borrowings - Current Liabilities (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16



Loans repayable on demand from other party - - 6,237.11

Other Loan from Bank 97.36 - -

Unsecured

Loans repayable on demand from banks - - 400.00

Loans repayable on demand from other party - 280.00 555.00

Loans and advances from related parties 490.00 1,005.00 1,099.95

Total 587.36 1,285.00 8,292.06

14 -Non-Current Provisions (H in Lacs)

As at

31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Provision for employee benefits (Refer note no 45)


Total 193.99 181.23 155.54

16 - Trade Payables (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

a) Due to micro, small and medium enterprise

(Refer note no 37)

- - -

b) Due to Others 34.15 54.75 116.93

Total 34.15 54.75 116.93

17 - Other Current Financial Liabilities (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

a) Current maturities of Long-Term debt (Refer

note no 36)

202.17 201.97 203.34

b) Application Money received for allotment of

warrants

2.00 - -

Total 204.17 201.97 203.34



18 - Other current liabilities (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

a) Revenue received in Advance 2.40 2.40 2.40

b) Statutory Dues Payable (includes Provident

Fund, GST, Withholding Tax etc.)

25.72 1.58 40.83

c) Outstanding Expenses Payable 13.06 258.06 284.75

d) Payable on Purchase of Investments - 54.75 166.21

e) Other Payables 52.93 61.98 403.58

Total 94.11 378.78 897.77

19 - Current Provisions (H in Lacs)

As at 31-Mar-18

As at

31-Mar-17

As at

1-Apr-16

Provision for Employee Benefits (Refer note no 45)

Gratuity 17.73 12.24 4.58


Total 34.78 28.99 19.53

20 - Revenue from Operations (H in Lacs)


Year ended

31-Mar-17

Merchant Banking and Advisory Fees 827.18 463.00

Corporate Restructuring Advisory Fees 1,484.24 1,232.50

Total 2,311.42 1,695.50

21 - Other Income (H in Lacs)


Year ended

31-Mar-17

Brokerage Income 1.08 -

Interest Income 37.43 36.50

Net Gain / (Loss) on Sale of Investments 4.14 220.84

Appreciation in value of investments 0.86 -

Gain on Foreign Exchange Transactions 2.74 -

Rent 4.80 4.80

Reimbursement of Expenses 40.00 -

Total 91.05 262.15



23 - Finance Costs (H in Lacs)


Year ended

31-Mar-17

Interest Expense 1.87 2.22

Total 1.87 2.22

24 - Other Expenses (H in Lacs)


Year ended

31-Mar-17

Electricity Expenses 3.03 3.49

Rent 47.17 39.36

Repairs & Maintenance 33.90 8.29

Insurance Premium 2.90 2.66

Rates & Taxes 0.62 1.82

Travelling & Conveyance 46.37 27.95

Consultancy & Professional Charges 108.07 57.39

Director's Sitting Fees 45.90 5.90

Auditor's Remuneration

- For Audit Fees 7.10 7.63

- For Other Services 0.85 0.75

Corporate Social Responsibility Expenses 20.20 5.00

Diminution in Value of Investments 23.93 710.01

Miscellaneous Expenses 81.00 48.87

Total 421.04 919.11

22 - Employee Benefits Expense (H in Lacs)


Year ended

31-Mar-17

Salaries 342.07 127.78

Contribution to Provident and Other Funds 6.40 4.31

Staff Welfare Expenses 5.84 6.37

Total 354.31 138.46

25 - Exceptional Items (H in Lacs)


Year ended

31-Mar-17

Amounts Written Back 302.40 5,645.83

Balances Written off (197.69) (4,596.17)

Total 104.71 1,049.66



26 - Tax Expenses(a) Amounts recognised in Profit & Loss (H in Lacs)


Year ended

31-Mar-17

Current income tax 373.10 593.53

Adjustment in respect of current income tax of previous year 0.64 -

Deferred income tax liability / (asset), net

- Origination and reversal of temporary differences (89.23) -

Deferred tax expense (89.23) -

Tax expense for the year 283.87 593.53

Effective tax rate for the year 16.55% 30.68%

(c) Reconciliation of Effective Tax Rate (H in Lacs)


Year ended

31-Mar-17

Profit Before Tax 1,695.28 1,893.74

Computed Tax Expense 478.74 783.57

Tax effect of:

Allowances (12.65) (1,347.60)

Expenses Disallowed 71.47 908.30

Capital Gains Set off against brought forward losses (1.15) (8.45)

Brought forward losses (429.03) (329.36)

MAT under Section 115JB 261.70 585.40

Current Tax Provision (A) 369.08 591.86

Deferred Tax Asset on account of Property, Plant and Equipment (27.99) -

Deferred Tax Asset on account of Retirement Benefit of

Employees

(61.24) -

Deferred Tax Provision (B) (89.23) -


Tax Expense recognised in Statement of Profit and Loss (A)+(B)+ (C) 280.49 591.86

(b) Amounts Recognised in Other Comprehensive Income (H in Lacs)

Year ended 31-Mar-18 Year ended 31-Mar-17

Before Tax

Tax (Expense)

Benefit

Net of Tax

Before

Tax

Tax

(Expense)

Benefit

Net of

Tax

Items that will not be

reclassified to profit or loss

Remeasurement of defined

benefit liability

(19.71) 4.02 (15.69) (41.10) 1.67 (39.43)

(19.71) 4.02 (15.69) (41.10) 1.67 (39.43)



(d) Movement in Deferred Tax Balances (H in Lacs)

March 31, 2018

Net Balance April 1, 2017

Recognised in Profit or

Loss

Net Balance

March 31,

2018

Deferred

Tax Asset

Deferred

Tax Liability

Deferred tax asset / (liabilities)

Property, plant and equipment - 27.99 27.99 27.99 -

Employee benefits - 61.24 61.24 61.24 -

Tax assets / (Liabilities) - 89.23 89.23 89.23 -

Set off tax - - - - -

Net tax assets / (liabilities) - 89.23 89.23 89.23 -

1) The company offsets tax assets and liabilities if and only if it has a legally enforceable right to

set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax

liabilities relate to income taxes levied by the same tax authority.

2) Significant management judgment is required in determining provision for income tax, deferred

income tax assets and liabilities and recoverability of deferred income tax assets. The recoverability

of deferred income tax assets is based on estimates of taxable income in which the relevant entity

operates and the period over which deferred income tax assets will be recovered.

27 - Other Comprehensive Income (H in Lacs)


Year ended

31-Mar-17

Gratuity Provision (5.58) (7.68)

Leave Encashment Provision (14.13) (33.42)

Total (19.71) (41.10)

28 Significant accounting policiesa) Basis of preparation of Financial Statements:

The Consolidated Financial Statements comprise the financial statements of Prime Securities

Limited (“the holding Company”) and its subsidiaries (“the holding Company and its subsidiaries

together referred as the group”) have been prepared in accordance with the Indian Accounting

Standards (Ind AS) to comply with the section 133 of the Companies Act 2013 (“the 2013 Act”),

read with Rule 3 of the Companies (Indian Accounting Standards) Rules 2015 and Companies

(Indian Accounting Standards) Rules 2016 for all periods up to and for the year ended March

31, 2017. The Group prepared its financial statements in accordance with accounting standards

notified under the section 133 of the Companies Act 2013, read together with paragraph 7 of the

Companies (Accounts) Rules, 2014 (Indian GAAP). These financial statements are the Group’s

first Ind AS financial statements and are covered by Ind AS 101, First-time adoption of Indian

Accounting Standards. The transition to Ind AS has been carried out from the accounting

principles generally accepted in India (“Indian GAAP”) which is considered as the “Previous

GAAP” for purposes of Ind AS 101. An explanation of how the transition to Ind AS has affected



the Group’s equity and its net profit is provided in Note no 47. The financial statements were

authorised for issue by the Holding Company’s Board of Directors on May 29, 2018.

All the assets and liabilities have been classified as current or non current as per the Group’s

normal operating cycle and other criteria set out in Schedule III to the Act. Based on the nature

of products and the time between the acquisition of assets for processing and their realization in

cash and cash equivalent, the Group has ascertained the operating cycle to be 12 months.

b) Principles of Consolidation:

The consolidated financial statements comprise the financial statements of Prime Securities

Limited (“the Holding Company”), its subsidiaries (the Holding Company and its subsidiaries

together referred as “the Group”) and associate company.

Subsidiaries

Subsidiaries are all entities that are controlled by the Company. Control exists when the Company

is exposed to, or has the ability to affect those returns through power over the entity. In assessing

control, potential voting rights are considered only if the rights are substantive. The financial

statements of subsidiaries are included in these consolidated financial statements from the

date that control commences until the date that control ceases. The financial statements of the

Company and its subsidiaries and jointly controlled entity have been consolidated using uniform

accounting policies for like transactions and other events in similar circumstances as mentioned

in those policies.

Upon loss of control, the Group derecognizes the assets and liabilities of the subsidiary, any non-

controlling interests and the other components of equity related to the subsidiary. Any surplus

or deficit arising on the loss of control is recognized in the Consolidated Statement of Profit

and Loss. If the Company retains any interest in the previous subsidiary, then such interest is

measured at fair value at the date that control is lost. Subsequently, it is accounted for as an

equity accounted investee depending on the level of influence retained.

Equity accounted investees

The Group's interests in equity accounted investees comprise interests in associates.

An Associate is an entity in which the Group has significant influence, but not control or joint

control, over the financial and operating policies.

Interest in associates are accounted for using equity method. They are initially recognised at cost

which includes transaction costs. Subsequent to initial recognition, the consolidated financial

statements include the Group's share of profit or loss and OCI of equity-accounted investees

until the date on which significant influence or joint control ceases.

Transactions eliminated on consolidation

Intra-group balances and transactions, and any unrealized income and expenses arising from

intra-group transactions, are eliminated in full while preparing these consolidated financial

statements. Unrealized gains or losses arising from transactions with equity accounted investees

are eliminated against the investment to the extent of the Company’s interest in the investee.

The financial statements of the subsidiaries and the jointly controlled entities used for the purpose



of consolidation are drawn upto the same reporting date as that of the Holding Company, i.e.

March 31, 2018. The Subsidiary Companies and Joint ventures considered in the consolidated

financial statements are:

Name of the Company Country of

Incorporation

% Ownership held as

at March 31, 2018

% Ownership held as

at March 31, 2017

Subsidiaries:

Primesec Investments Limited India 100% 100%

Prime Commodities Broking

(India) Limited

India 100% 100%

Prime Research & Adviosry

Limited

India 100% 100%

Associates:

Primary Cuisine Private Limited India 24% 24%

“Minority interest” represents the amount of equity attributable to minority shareholders at the

date on which investment in the subsidiary is made and its share of movements in the equity

since the date the parent subsidiary relationship comes into existence.

Functional and presentation currency

These financial statements are presented in Indian rupees in lakhs, which is the Holding

Company’s functional currency. All amounts have been rounded off to two decimal places to

the nearest lakh, unless otherwise indicated.

The consolidated financial statements have been prepared using uniform accounting policies for

like transactions and other events in similar circumstances.

The financial statements of the subsidiaries used for the purpose of consolidation are drawn upto

the same reporting date as that of the Holding Company, i.e. March 31, 2018.

Historical cost convention

The Consolidated financial statements have been prepared on a historical cost basis, except for

the following:

• certain consolidated financial assets and liabilities (includingderivative instrument) that are

measured at fair value;

• definedbenefitplans–planassetsmeasuredatfairvalue

c) Use of Estimates and Judgements:

The preparation of consolidated financial statements in accordance with Ind AS requires use of

estimates and assumptions for some items, which might have an effect on their recognition and

measurement in the Consolidated balance sheet and Consolidated statement of profit and loss.

The actual amounts realised may differ from these estimates. Estimates and assumptions are

required in particular for:

• DeterminationoftheestimatedusefullivesofPropertyPlantandEquipments:

Useful lives of Property plant and equipment are based on the life prescribed in Schedule II of

the Companies Act, 2013.



•Recognitionandmeasurementofdefinedbenefitobligations:

The obligation arising from defined benefit plan is determined on the basis of actuarial

assumptions. Key actuarial assumptions include discount rate, trends in salary escalation,

actuarial rates and life expectancy. The discount rate is determined by reference to market

yields at the end of the reporting period on government bonds. The period to maturity of

the underlying bonds correspond to the probable maturity of the post-employment benefit

obligations.

•Recognitionofdeferredtaxassets:

Deferred tax assets and liabilities are recognized for the future tax consequences of temporary

differences between the carrying values of assets and liabilities and their respective tax

bases, and unutilized business loss and depreciation carry-forwards and tax credits. Deferred

tax assets are recognized to the extent that it is probable that future taxable income will be

available against which the deductible temporary differences, unused tax losses, depreciation

carry-forwards and unused tax credits could be utilized.

• Recognitionandmeasurementofotherprovisions:

The recognition and measurement of other provisions are based on the assessment of the

probability of an outflow of resources, and on past experience and circumstances known at

the balance sheet date. The actual outflow of resources at a future date may therefore vary

from the amount included in other provisions.

• Discountingoflong-termfinancialassets/liabilities:

All financial assets / liabilities are required to be measured at fair value on initial recognition. In

case of financial liabilities/assets which are required to subsequently be measured at amortised

cost, interest is accrued using the effective interest method.

• Determiningwhetheranarrangementcontainsalease

At inception of an arrangement, the Group determines whether the arrangement is or contains

a lease.

At inception or on reassessment of an arrangement that contains a lease, the Group separates

payments and other consideration required by the arrangement into those for the lease and

those for other elements on the basis of their relative fair values. If the Group concludes

for a finance lease that it is impracticable to separate the payments reliably, then an asset

and a liability are recognised at an amount equal to the fair value of the underlying asset;

subsequently, the liability is reduced as payments are made and an imputed finance cost

on the liability is recognised using the Group’s incremental borrowing rate. And in case of

operating lease, treat all payments under the arrangement as lease payments.

• Segmentreporting:

Operating segments are reported in a manner consistent with the internal reporting. The

Group prepares its segment information in conformity with the accounting policies adopted

for preparing and presenting the financial statements of the Group as a whole.

• Fairvalueoffinancialinstruments

Derivatives are carried at fair value. Derivatives includes foreign currency forward contracts

and interest rate swaps. Fair valued of foreign currency forward contracts are determined

using the fair value reports provided by respective merchant bankers. Fair value of interest rate

swaps are determined with respect to current market rate of interest.



• Measurementoffairvalues:

The Group’s accounting policies and disclosures require the measurement of fair values for

financial instruments.

The Group has an established control framework with respect to the measurement of fair

values. The management regularly reviews significant unobservable inputs and valuation

adjustments. If third party information, such as broker quotes or pricing services, is used to

measure fair values, then the management assesses the evidence obtained from the third

parties to support the conclusion that such valuations meet the requirements of Ind AS,

including the level in the fair value hierarchy in which such valuations should be classified.

When measuring the fair value of a financial asset or a financial liability, the Group uses

observable market data as far as possible. Fair values are categorised into different levels in a

fair value hierarchy based on the inputs used in the valuation techniques as follows.

• Level1:quotedprices(unadjusted)inactivemarketsforidenticalassetsorliabilities.

•Level2:inputsotherthanquotedpricesincludedinLevel1thatareobservablefortheasset

or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

• Level 3: inputs for the asset or liability that are not based on observable market data

(unobservable inputs).

• Iftheinputsusedtomeasurethefairvalueofanassetoraliabilityfallintodifferentlevelsof

the fair value hierarchy, then the fair value measurement is categorised in its entirety in the

same level of the fair value hierarchy as the lowest level input that is significant to the entire

measurement.

•TheGrouprecognisestransfersbetweenlevelsofthefairvaluehierarchyattheendofthe

reporting period during which the change has occurred.

d) Property, plant and equipment:

• Recognitionandmeasurement:

Items of property, plant and equipment are measured at cost less accumulated depreciation

and any accumulated impairment losses.

The cost of an item of property, plant and equipment comprises:

Its purchase price, including import duties and non-refundable purchase taxes, after deducting

trade discounts and rebates.

Any costs directly attributable to bringing the asset to the location and condition necessary for

it to be capable of operating in the manner intended by management.

Any gain or loss on disposal of an item of property, plant and equipment is recognised in

consolidated profit or loss.

The cost of the property, plant and equipment’s at 1st April 2016, the Group’s date of transition

to Ind AS, was determined with reference to its carrying value at that date.

e) Depreciation:

•Depreciationontangibleassetsisprovidedonthestraight-linemethodovertheusefullivesof

assets as prescribed under Part C of Schedule II of the Companies Act, 2013;

Useful life of Property Plant and Equipment are reviewed at each balance sheet date and

adjusted prospectively, if appropriate.



• Depreciationonadditiontoassetsoronsale/discardmentofassets, iscalculatedprorata

from the date of such addition or upto the date of such sale/discardment, as the case may be;

• IndividualassetsexceptassetsgivenonleaseacquiredforlessthanH5,000/- are depreciated

entirely in the year of acquisition.

f) Intangible Fixed Assets:

Intangible assets, which are acquired by the Group and have finite useful lives are measured at

cost less accumulated amortisation and any accumulated impairment losses.

All other expenditure, including expenditure on internally generated goodwill and brands, is

recognised in profit or loss as incurred.

The cost of intangible assets at April 1, 2016, the Group’s date of transition to Ind AS, was

determined with reference to its carrying value at that date.

g) Financial Instruments:

A financial instrument is any contract that gives rise to a financial asset of one entity and a

financial liability or equity instrument of another entity. Financial instruments also include

derivative contracts such as foreign currency foreign exchange forward contracts and, interest

rate swaps and currency options; and embedded derivatives in the host contract.

Financial instruments also covers contracts to buy or sell a non-financial item that can be settled

net in cash or another financial instrument, or by exchanging financial instruments, as if the

contracts were financial instruments, with the exception of contracts that were entered into

and continue to be held for the purpose of the receipt or delivery of a non-financial item in

accordance with the entity’s expected purchase, sale or usage requirements.

Financial Assets:

Classification:

The Group shall classify financial assets as subsequently measured at amortised cost, fair value

through other omprehensive income or fair value through profit or loss on the basis of its

business model for managing the financial assets and the contractual cash flow characteristics

of the financial asset.


All financial assets are recognised initially at fair value plus, in the case of financial assets

not recorded at fair value through profit or loss, transaction costs that are attributable to the

acquisition of the financial asset. Purchases or sales of financial assets that require delivery of

assets within a time frame established by regulation or convention in the market place (regular

way trades) are recognised on the trade date, i.e., the date that the Group commits to purchase

or sell the asset.

Equity investments:

All other equity investments in scope of Ind AS 109 are measured at fair value. Equity instruments

which are held for trading are classified as at FVTPL. For all other equity instruments, the Group

decides to classify the same either as at FVOCI or FVTPL. The Group makes such election on an

instrument-by-instrument basis. The classification is made on initial recognition and is irrevocable.

If the Group decides to classify an equity instrument as FVOCI, then all fair value changes on the

instrument, excluding dividends, are recognized in the OCI. There is no recycling of the amounts



from OCI to profit and loss, even on sale of investment. However, the Group may transfer the

cumulative gain or loss within equity.

Equity instruments included within the FVTPL category are measured at fair value with all changes

recognized in the profit and loss.

Derecognition:

A financial asset (or, where applicable, a part of a financial asset or part of a Group of similar

financial assets) is primarily derecognised (i.e. removed from the Group’s balance sheet) when:

• Therightstoreceivecashflowsfromtheassethaveexpired,or

• TheGrouphastransferreditsrightstoreceivecashflowsfromtheassetorhasassumedan

obligation to pay the received cash flows in full without material delay to a third party under a

‘passthrough’ arrangement; and either (a) the Group has transferred substantially all the risks

and rewards of the asset, or (b) the Group has neither transferred nor retained substantially all

the risks and rewards of the asset, but has transferred control of the asset

When the Group has transferred its rights to receive cash flows from an asset or has entered

into a pass-through arrangement, it evaluates if and to what extent it has retained the risks and

rewards of ownership. When it has neither transferred nor retained substantially all of the risks

and rewards of the asset, nor transferred control of the asset, the Group continues to recognise

the transferred asset to the extent of the Group’s continuing involvement. In that case, the

Group also recognises an associated liability. The transferred asset and the associated liability are

measured on a basis that reflects the rights and obligations that the Group has retained.

Continuing involvement that takes the form of a guarantee over the transferred asset is

measured at the lower of the original carrying amount of the asset and the maximum amount of

consideration that the Group could be required to repay.

Impairment of financial assets:

In accordance with Ind-AS 109, the Group applies expected credit loss (ECL) model for

measurement and recognition of impairment loss on the following financial assets and credit risk

exposure:

a) Financial assets that are debt instruments, and are measured at amortised cost e.g., loans,

debt securities, deposits, and bank balance.

b) Trade receivables - The application of simplified approach does not require the group to track

changes in credit risk. Rather, it recognises impairment loss allowance based on lifetime

ECLs at each reporting date, right from its initial recognition. Trade receivables are tested

for impairment on a specific basis after considering the sanctioned credit limits, security like

letters of credit, security deposit collected etc. and expectations about future cash flows.

Financial liabilities:

Classification

The Group classifies all financial liabilities as subsequently measured at amortised cost, except for

financial liabilities at fair value through profit or loss. Such liabilities, including derivatives that are

liabilities, shall be subsequently measured at fair value.


Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through



profit or loss, loans and borrowings, payables, or as derivatives designated as hedging instruments

in an effective hedge, as appropriate.

All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings

and payables, net of directly attributable and incremental transaction cost.

Amortised cost is calculated by taking into account any discount or premium on acquisition and

fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs

in the statement of profit and loss.

The Group’s financial liabilities include trade and other payables, loans and borrowings including

bank overdrafts and derivative financial instruments.

Derecognition:

A financial liability is derecognised when the obligation under the liability is discharged or

cancelled or expires. When an existing financial liability is replaced by another from the same

lender on substantially different terms, or the terms of an existing liability are substantially

modified, such an exchange or modification is treated as the derecognition of the original

liability and the recognition of a new liability. The difference in the respective carrying amounts is

recognised in the statement of profit or loss.

Offsetting of financial instruments:

Financial assets and financial liabilities are offset and the net amount is reported in the balance

sheet if there is a currently enforceable legal right to offset the recognised amounts and there is

an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously.

h) Employee Benefits:

Short Term Employee Benefits:

All employee benefits payable within twelve months of rendering the service are recognised in

the period in which the employee renders the related service.

Post Employment / Retirement Benefits:

Contribution to Defined Contribution Plans such as Provident Fund, Employees’ State Insurance

Corporation, etc., are charged to the Statement of Profit and Loss as incurred.

Defined Benefit Plans – The present value of the obligation under such plans, is determined

based on an actuarial valuation by an independent actuary at the end of each year, using the

Projected Unit Credit Method. In the case of gratuity, which is funded, the fair value of the plan

assets is reduced from the gross obligation under the defined benefit plans, to recognise the

obligation on net basis.

Remeasurement of net defined benefit liability, which comprises actuarial gains and losses and

the return on plan assets (excluding interest) and the effect of the asset ceiling (if any excluding

interest), are recognized immediately in other comprehensive income.

Other Long Term Employee Benefits:


Accumulated compensated absences, which are expected to be availed or encashed within 12

months from the end of the year end are treated as short term employee benefits. The obligation

towards the same is measured at the expected cost of accumulating compensated absences

as the additional amount expected to be paid as a result of the unused entitlement as at the



year end. Accumulated compensated absences, which are expected to be availed or encashed

beyond 12 months from the end of the year end are treated as other long term employee

benefits. The Group’s liability is actuarially determined (using the Projected Unit Credit method)

at the end of each year. Actuarial losses/ gains are recognised in the Statement of Profit and Loss

in the year in which they arise.

i) Foreign Exchange Transactions:

Transactions in foreign currencies are translated into the respective functional currencies of the

Group at the exchange rates at the dates of the transactions.

Monetary assets and liabilities denominated in foreign currencies are translated into the functional

currency at the exchange rate at the reporting date. Non-monetary assets and liabilities that are

measured at fair value in a foreign currency are translated into the functional currency at the

exchange rate when the fair value was determined. Foreign currency differences are generally

recognised in statement of profit or loss. Non-monetary items that are measured based on

historical cost in a foreign currency are translated using the exchange rate as at the date of

transaction.

j) Borrowing Costs:

Borrowing costs that are directly attributable to the acquisition or construction of an asset that

necessarily takes a substantial period of time to get ready for its intended use are capitalised as

part of the cost of that asset till the date it is ready for its intended use or sale. Other borrowing

costs are recognised as an expense in the period in which they are incurred.

k) Recognition of Income and Expenditure:

i) Merchant Banking and Advisory Fees are accrued as per the terms of contract except where

there is uncertainty as to their realization.

ii) Revenue/Income and Cost/Expenditure are accounted on accrual as they are earned or

incurred, except in case of significant uncertainties.

iii) Dividend income is recognised when the right to receive is established.

iv) Interest income is recognised on accrual basis.

v) Gain or losses on sale of investments are recognized on trade dates by comparing the sales

realization with the weighted average cost of such investment.

l) Leases:

Lease payments:

Payments made under operating leases are recognised in consolidated statement of profit or loss

on a straight line basis over the term of the lease unless such payments are structured to increase

in line with expected general inflation to compensate for the lessor’s expected inflationary cost

increase. Lease incentives received are recognised as an integral part of the total lease expense,

over the term of the lease.

Minimum lease payments made under finance leases are apportioned between the finance

expense and the reduction of the outstanding liability. The finance expense is allocated to

each period during the lease term so as to produce a constant periodic rate of interest on the

remaining balance of the liability.

Assets held under other leases are classified as operating leases and are not recognised in the

Group’s statement of financial position.



m) Impairment of non-financial assets:

The carrying values of assets/cash generating units at each balance sheet date are reviewed for

impairment if any indication of impairment exists. If the carrying amount of the assets exceed the

estimated recoverable amount, an impairment is recognised for such excess amount.

The recoverable amount is the greater of the net selling price and their value in use. Value in use

is arrived at by discounting the future cash flows to their present value based on an appropriate

discount factor.

When there is indication that an impairment loss recognised for an asset (other than a revalued

asset) in earlier accounting periods which no longer exists or may have decreased, such reversal

of impairment loss is recognised in the Statement of Profit and Loss, to the extent the amount

was previously charged to the consolidated Statement of Profit and Loss. In case of revalued

assets, such reversal is not recognised.

n) Cash and cash equivalents:

Cash and cash equivalent in the balance sheet comprise cash at banks and on hand and

short-term deposits with an original maturity of three months or less, which are subject to an

insignificant risk of changes in value.



an integral part of the Group’s cash management.

o) Taxation:

Income tax expense comprises current and deferred tax. It is recognised in profit or loss except

to the extent that it relates to a business combination, or items recognised directly in equity or in

OCI.

i) Current tax:

Current tax comprises the expected tax payable or receivable on the taxable income or loss

for the year and any adjustment to the tax payable or receivable in respect of previous years.

It is measured using tax rates enacted or substantively enacted at the reporting date. Current

tax also includes any tax arising from dividends.

Current tax assets and liabilities are offset only if, the Group:

a) has a legally enforceable right to set off the recognised amounts; and

b) intends either to settle on a net basis, or to realise the asset and settle the liability

simultaneously.

ii) Deferred tax:

Deferred tax is recognised in respect of temporary differences between the carrying

amounts of assets and liabilities for financial reporting purposes and the amounts used for

taxation purposes. Deferred tax is not recognised for:

• temporarydifferencesontheinitialrecognitionofassetsorliabilitiesinatransactionthat

is not a business combination and that affects neither accounting nor taxable profit or

loss;

• temporarydifferencesrelatedtoinvestmentsinsubsidiariesandassociatestotheextent

that the Group is able to control the timing of the reversal of the temporary differences

and it is probable that they will not reverse in the foreseeable future; and

• taxabletemporarydifferencesarisingontheinitialrecognitionofgoodwill.



Deferred tax assets are recognised for unused tax losses, unused tax credits and deductible

temporary differences to the extent that it is probable that future taxable profits will be

available against which they can be used. Deferred tax assets are reviewed at each reporting

date and are reduced to the extent that it is no longer probable that the related tax benefit

will be realised; such reductions are reversed when the probability of future taxable profits

improves.

Unrecognized deferred tax assets are reassessed at each reporting date and recognised to

the extent that it has become probable that future taxable profits will be available against

which they can be used.

Deferred tax is measured at the tax rates that are expected to be applied to temporary

differences when they reverse, using tax rates enacted or substantively enacted at the

reporting date.

The measurement of deferred tax reflects the tax consequences that would follow from the

manner in which the Group expects, at the reporting date, to recover or settle the carrying

amount of its assets and liabilities.

Deferred tax assets and liabilities are offset only if:

a) The entity has a legally enforceable right to set off current tax assets against current tax

liabilities; and

b) The deferred tax assets and the deferred tax liabilities relate to income taxes levied by

the same taxation authority on the same taxable entity.

Deferred tax asset / liabilities in respect of on temporary differences which originate and

reverse during the tax holiday period are not recognised. Deferred tax assets / liabilities in

respect of temporary differences that originate during the tax holiday period but reverse after

the tax holiday period are recognised.

p) Provisions, Contingent Assets and Contingent Liabilities:

Provisions are determined by discounting the expected future cash flows specific to the liability.

The unwinding of the discount is recognised as finance cost. A provision for onerous contracts

is measured at the present value of the lower of the expected cost of terminating the contract

and the expected net cost of continuing with the contract. Before a provision is established, the

Group recognises any impairment loss on the assets associated with that contract.

A disclosure for a contingent liability is made when there is a possible obligation or a present

obligation that may, but will probably not, require an outflow of resources. When there is a

possible obligation or a present obligation in respect of which the likelihood of outflow of

resources is remote, no provision or disclosure is made.

A contingent asset is not recognised but disclosed in the financial statements where an inflow of

economic benefit is probable.



(H in Lacs)

Sr.

No.

Particulars March 31, 2018

March 31,

2017

April 1,

2016

i) Demands raised by Tax Authorities against which

the Company has preferred appeals

13.18 13.18 276.29

ii) Corporate guarantee given for financial facilties

for subsidiaries

- - 15.00

iii) Claims made not acknowledged as debts - 1,855.99 4,004.56

29 Contingent Liabilities to the extent not provided for in respect of:

35 Share capital:(a) Rights, preferences and restrictions attached to Equity Shares:

The Company has only one class of equity shares having a par value of H5/- per share. Each

shareholder is eligible for one vote per share held. The dividend proposed by the Board of

Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting,

except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible

to receive the remaining assets of the Company after distribution of all preferential amounts, in

proportion to their shareholding.

(b) Details of equity shares held by shareholders holding more than 5% of the aggregate equity

shares in the Company:

Name of the

ShareholderAs at March 31, 2018 As at March 31, 2017 As at April 1, 2016

No. of shares held

% of Holding

No. of shares held

% of

Holding

No. of

shares

held

% of

Holding

Judith Investments

Private Limited

17,83,497 6.73 26,83,497 10.12 26,83,497 10.14

N. Jayakumar 31,24,759 11.78 20,84,759 7.86 20,84,759 7.87

Videocon Industries

Limited

- - - - 17,62,565 6.66

30 A winding up order has been passed by Hon'ble High Court at Bombay and Official Liquidator has

been appointed in respect of one of the subsidiary viz., Prime Broking Company (India) Limited. In

view thereof, the Company has ceased to exercise control over the said subsidiary. Accordingly,

the consolidated financial statements does not include the financial results of the said subsidiary

as it has failed to meet the test for consolidation.

31 In the earlier financial years, the group had written-back H1,400 Lacs as in the opinion of the

management, the same was no longer payable. The Company has been legally advised that there

will be no liability due as the debt had become time-barred.

32 The Group has written back an outstanding payable of H219.07 lacs by crediting the statement of

Profit & Loss as the same was no longer payable in the opinion of the management.

33 In the earlier financial year, the Group has reinstated an advance of H327.50 lacs which was

previously written-off as not recoverable. The management is hopeful of recovery of the same.

34 The Group has written back a liability of H24.74 lacs by crediting the statement of Profit & Loss as

the same was no longer payable pursuant to a one time settlement with the creditor.



(c) Reconciliation of number of equity shares outstanding as on beginning and closing of the year

Particulars 2017-18 2016-17 2015-16

Numbers H in Lacs Numbers H in Lacs Numbers H in Lacs

Opening Balance 2,65,15,325 1,329.94 2,64,73,525 1,327.85 2,64,73,525 1,327.85

Add: Shares issued

during the year

- - 41,800 2.09 - -

Closing Balance 2,65,15,325 1,329.94 2,65,15,325 1,329.94 2,64,73,525 1,327.85

Particulars/

(Excercise Price)

ESOS 2007 (H38/-) ESOS 2008 (H15/-) ESOS 2009 (H38/-)

Current

Year

Previous

Year

Current

Year

Previous

Year

Current

Year

Previous

Year


beginning of the Year

40,000 80,000 - 88,400 2,13,200 3,20,000

Add: Granted during

the Year

- - - - - -

Less: Exercised during

the Year

- - - 41,800 - -

Less: Lapsed during

the Year

40,000 40,000 - 46,600 1,06,800 1,06,800


end of the Year

- 40,000 - - 1,06,400 2,13,200

35 Employees Stock Option Schemes (ESOS) The Company’s stock based compensation plan for employees comprises of three schemes

viz. the ESOS 2007 Scheme, ESOS 2008 and the ESOS 2009 Scheme. The schemes have been

instituted for all eligible employees of the Company and its subsidiaries. The Company has

reserved issuance of 1,06,400 (Previous year 2,53,200) Equity Shares of H5/- each for offering to

eligible employees of the Company and its subsidiaries under Employees Stock Option Scheme

(ESOS) approved by Members. During the year, the Company has granted NIL (Previous year NIL)

Options to the eligible employees.

ESOS 2007 Scheme




ESOS 2008 Scheme




ESOS 2009 Scheme






The fair value has been calculated using the Black-Scholes Option Pricing Model and the

significant assumptions and inputs to estimate the fair value of options during the year are as

follows:

Sr.

No.

Particulars 2017-18

(A) Weighted average risk-free rate 8.10%

(B) Weighted average expected life of options 8 years

(C) Weighted average expected volatility 64.25%

(E) Weighted average share price H37.05 Per Share

(F) Weighted average exercise price H38 Per Share

(G) Method used to determine expected volatility Based on the returns generated on

equity shares of Company for the

period from 2005 to 2010

Expense on Employee Stock Options Scheme debited to the Statement of Profit and Loss during

the year is H29.22 Lakhs

36 Borrowings: (A) Secured loans:

a) Term Loan from Bank:

Term loan of H9.29 Lakhs (March 31, 2017 H11.26 lakhs) from the Bank is secured against

Vehicle of the Company.

b) Other Loan from Bank:

Other Loan from Bank of H200 Lakhs (March 31, 2017 H400 Lakhs, April 01, 2016 H600 Lakhs)

is secured against pledge of shares of other parties. Overdraft against Fixed Deposit from

Bank of H97.36 Lakhs (March 31, 2017 H Nil, April 01, 2016 H Nil) is secured against Fixed

Deposit of the Bank.

c) Term of Repayment

Term Loan from Bank is repayable in equal monthly instalment, the last instalment is due on

December 1, 2021 as per repayment schedule having interest rate of 9.50% p.a. Other Loan

from bank of H200 Lakhs is interest free and repayable in equal yearly instalment, the last

instalment is due on December 31, 2018. Overdraft against Fixed Deposit from Bank having

interest rate of 7.85% is repayable on demand.

(B) Unsecured loans:

Loan from other party is unsecured, interest free and repayable on demand. Loan from related

party is from an associate company in which a director is interested. It is an interest free unsecured

loan and repayable on demand.



37 Dues to micro and small suppliers: Under the Micro, Small and Medium Enterprises Development Act, 2006, (MSMED) which came

into force from October 2, 2006, certain disclosures are required to be made relating to Micro,

Small and Medium enterprises. On the basis of the information and records available with the

management, there are no outstanding dues to the Micro and Small enterprises as defined in the

Micro, Small and Medium Enterprises Development Act, 2006.

Particulars 31-Mar-18 31-Mar-17 01-Apr-16

Principal amount remaining unpaid to any supplier

as at the year end

- - -

Interest due thereon - - -

Amount of interest paid by the Company in terms

of section 16 of the MSMED, along with the amount

of the payment made to the supplier beyond the

appointed day during the accounting year

- - -

Amount of interest due and payable for the period

of delay in making payment (which have been paid

but beyond the appointed day during the period)

but without adding the interest specified under the

MSMED

- - -

Amount of interest accrued and remaining unpaid

at the end of the accounting year

- - -

38 Related Party Disclosures: Related party disclosures in respect of related parties with whom transactions have taken place

during the year are given below:

Names of related parties and their relationships:

Associate Companies: Gateway Entertainment Limited

Judith Investments Private Limited

Primary Cuisine Private Limited

Key Management Personnels: Mr. N. Jayakumar

Mr. Ajay Shah

Independent Directors: Mr. Pradip Dubhashi

Mr. S R Sharma

Mr. Anil Dharker

Ms. Alpana Parida

Relative of Key Management Personnel: Mrs. Madhu Jayakumar



The following transactions were carried out with the related parties in the ordinary course of

business during the year 2017 2018: (H in Lacs)

Sr.

No.


Current

Year

Previous

Year

1 Interest free Inter corporate deposit received

from Gateway Entertainment Limited

Associate

Company

- Write back of ICD no longer payable 30.00 -

2 Remuneration paid to Key Managerial

Personnel

Key Management

Personnel

178.03 66.28

3 Sitting Fees for Board and Committee

Meetings to Independent Directors

Key Management

Personnel

45.90 5.90

4 Shares issued to Key Managerial Personnel Key Management

Personnel

- 2.49

5 Loan given to / received back from Primary

Cuisine Private Limited

Associate

Company

- Loan given 300.00 5.57

- Loan Received back 100.00 168.41

6 Repayment of Interest free unsecured loan

received from Mr. N Jayakumar

Key Management

Personnel

430.00 94.95

7 Repayment of Interest free unsecured Inter

Corporate Deposit from Judith Investments

Private Limited

Associate

Company

85.00 -

Outstanding Balance (H in Lacs)

Sr.

No.

Nature of Transaction Relationship Balance as on

March 31,

2018

March 31,

2017

1 Interest free Inter corporate deposit from

Gateway Entertainment Limited

Associate

Company

- 30.00

(Credit)

2 Interest free unsecured loan from Mr N

Jayakumar

Key Management

Personnel

- 430.00

(Credit)

3 Interest free unsecured Inter Corporate

Deposit from Judith Investments Private

Limited

Associate

Company

490.00

(Credit)

575.00

(Credit)

Note:

The remuneration paid to key managerial personnel excludes gratuity and compensated

absences as the provision is computed for the company as a whole and separate figures are

not available.

39 Operating Lease in respect of Assets taken on Lease: (H in Lacs)

Sr.

No.

Particulars Year ended

March 31, 2018

Year ended

March 31, 2017

i) Total of future minimum lease payments

a) Not later than one year 55.56 33.49

b) Later than one year and not later than five years 67.26 51.30

ii) Lease payments recognised in the Profit and Loss

account

47.17 39.36



40 The Company has only one segment i.e. corporate advisory services. There are no separate

reportable segments as required by IND AS 108 – Operating Segments.

41 Subsequent Events : There are no significant subsequent events that would require adjustments or disclosures in the

financial statements as on the balance sheet date.

42 Corporate Social Responsibility As required by Section 135 of Companies Act, 2013 and rules therein, a Corporate social

responsibility committee has been formed by the Company, The Company has spent the

following amount during the year towards corporate social responsibility (CSR) for activities listed

under schedule VII of the Companies Act, 2013

(a) Gross amount required to be spent by the Company during the year 2017-18 H20.35 lakhs

(Previous year H Nil).

(b) Amount spent during the year on: (H in Lacs)

Particulars 2017-18 2016-17 2015-16

(i) Construction / acquisition of any asset - - -

(ii) On purpose other than (i) above 20.20 5.00

43 Financial instruments – Fair values and risk managementA) Accounting classification and fair values

Carrying amounts and fair values of financial assets and financial liabilities, including their levels

in the fair value hierarchy, are presented below. It does not include the fair value information

for financial assets and financial liabilities not measured at fair value if the carrying amount is a

reasonable approximation of fair value.(H in Lacs)

March 31, 2018 Carrying amount Fair value


Cost


Financial assets



Advance Given - - 327.50 327.50 - - - -




Other Bank Balance - - 525.00 525.00 - - - -

Loans - - 200.00 200.00 - 200.00 - 200.00


164.27 - 1,362.15 1,526.42 - 228.83 - 228.83






- - 832.80 832.80 - 7.13 - 7.13



(H in Lacs)

March 31, 2017 Carrying amount Fair value


Cost


Financial assets



Advance Given - - 327.50 327.50 - - - -






188.59 - 1,644.09 1,832.68 - 19.93 - 19.93






- - 1,751.01 1,751.01 - 209.29 - 209.29

(H in Lacs)

April 1, 2016 Carrying amount Fair value


Cost


Financial assets

Non Current Investments * 3,148.92 - - 3,148.92 - - - -





Loans - - 162.84 162.84 - 162.84 - 162.84

Other Current Financial Assets - - 1,296.20 1,296.20 - - - -

3,178.56 - 1,942.87 5,121.43 - 182.77 - 182.77






- - 9,012.32 9,012.32 - 400.00 - 400.00

* The fair value in respect of the unquoted equity investments is equal to the cost of the investments

as per the contractual arrangements.



B) Measurement of fair values:

Valuation techniques and significant unobservable inputs

The following tables show the valuation techniques used in measuring Level 2 and Level 3 fair

values, as well as the significant unobservable inputs used.

Financial instruments measured at fair value

Type Valuation technique

Fixed rates long term borrowings The valuation model considers present value of expected

payments discounted using an appropriate discounting rate.

Security Deposits The valuation model considers present value of expected

payments discounted using an appropriate discounting rate.

C) Financial risk management The Company has exposure to the following risks arising from financial instruments:

•Creditrisk; •Liquidityrisk;and •Marketrisk

i) Risk management framework The Company’s Board of Directors has overall responsibility for the establishment and

oversight of the Company’s Risk Management framework. The Board of Directors have

adopted an Enterprise Risk Management Policy framed by the Company, which identifies

the risk and lays down the risk minimization procedures. The Management reviews the

Risk management policies and systems on a regular basis to reflect changes in market

conditions and the Company’s activities, and the same is reported to the Board of Directors

periodically. Further, the Company, in order to deal with the future risks, has in place various

methods / processes which have been imbibed in its organizational structure and proper

internal controls are in place to keep a check on lapses, and the same are been modified in

accordance with the regular requirements.

The Audit Committee oversees how Management monitors compliance with the

Company’s Risk Management policies and procedures, and reviews the adequacy of the

risk management framework in relation to the risks faced by the Company. The Audit

Committee is assisted in its oversight role by the internal auditors.

ii) Credit risk Credit risk is the risk of financial loss to the Company if a customer or counterparty to a

financial instrument fails to meet its contractual obligations, and arises principally from the

Company's receivables from customers and loans and advances.

The carrying amount of following financial assets represents the maximum credit exposure:

Trade receivables and loans and advances. The Company’s exposure to credit risk is influenced mainly by the individual characteristics

of each customer in which it operates. Credit risk is managed through credit approvals,

establishing credit limits and continuously monitoring the creditworthiness of customers to

which the Company grants credit terms in the normal course of business.

The Risk Management Committee has established a credit policy under which each new

customer is analysed individually for creditworthiness before the Company’s standard

payment and delivery terms and conditions are offered.

For trade receivables, the company individually monitors outstanding balances. Accordingly,

the Company makes specific provisions against such trade receivables wherever required

and monitors the same at periodic intervals.



The Company monitors each loans and advances given and makes any specific provision

wherever required.

The Company establishes an allowance for impairment that represents its estimate of

expected losses in respect of trade receivables and loans and advances.

Impairment: At March 31, 2018, the ageing of trade receivables was as follows.

Particulars Carrying amount (` in lacs)


Neither past due nor impaired - 226.10 -

Past due 1–90 days 126.35 10.50 -

Past due 91–180 days - - -

Past due 181-365 days - 192.28 -

Past due 366 days 3.28 - -

129.63 428.88 -

Management believes that the unimpaired amounts which are past due are collectible in full.

Cash and cash equivalents and other Bank balances

The Company held cash and cash equivalents and other bank balances of H10.74 lacs as on

March 31, 2018 (March 31, 2017: H285.72 lacs and April 1, 2016: H67.43 lacs). The cash and

cash equivalents are held with banks with good credit ratings.

Loans and Advances:

The Company held Loans and advances of H340.45 lacs as on March 31, 2018 (March 31,

2017: H146.71 lacs and April 1, 2016: H1459.03 lacs). The loans and advances are in nature of

rent deposit paid to landlords and advances to other parties and are fully recoverable in the

opinion of management.

iii) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations

associated with its financial liabilities that are settled by delivering cash or another financial

asset. The Company’s approach to managing liquidity is to ensure, as far as possible, that

it will have sufficient liquidity to meet its liabilities when they are due, under both normal

and stressed conditions, without incurring unacceptable losses or risking damage to the

Company’s reputation.

Maturity profile of financial liabilities

The following are the remaining contractual maturities of financial liabilities at the reporting

date. The amounts are gross and undiscounted, and include estimated interest payments

and exclude the impact of netting agreements.(H in Lacs)


amount


Total less

than 6

months

6-12

months

1-2

years

2-5

years

More

than 5

years

Borrowings 594.49 594.49 587.36 - 5.00 2.13 -





iv) Market risk Market risk is the risk that changes in market prices – such as foreign exchange rates, interest

rates and equity prices – will affect the Company’s income or the value of its holdings

of financial instruments. Market risk is attributable to all market risk sensitive financial

instruments including foreign currency receivables and payables and long term debt. We

are exposed to market risk primarily related to foreign exchange rate risk, interest rate risk

and the market value of our investments. Thus, our exposure to market risk is a function of

investing and borrowing activities and revenue generating and operating activities in foreign

currency. The objective of market risk management is to avoid excessive exposure in our

foreign currency revenues and costs.

Currency risk The Company is not significantly exposed to currency risk. The functional currency of the

Company is Indian Rupee.

Exposure to currency risk (Exposure in different currencies converted to functional currency

i.e. INR)

The currency profile of financial assets and financial liabilities as at March 31, 2018 are as

below:

(H in Lacs)


amount


Total less

than 6

months

6-12

months

1-2

years

2-5

years

More

than 5

years

Borrowings 1,494.29 1,494.29 1,285.00 - 204.54 4.75 -



(H in Lacs)

April 1, 2016 Carrying

amount


Total less than

6 months

6-12

months

1-2

years

2-5 years More

than 5

years

Borrowings 8,692.06 8,692.06 4,467.11 - 400.00 3,824.95 -

Trade and other

payables

116.93 116.93 116.93 - - - -

Other financial

liabilities

203.34 203.34 1.68 201.66 - - -

The gross inflows/(outflows) disclosed in the above tables represent the contractual

undiscounted cash flows relating to the financial liabilities which are not usually closed out

before contractual maturity.

March 31, 2018 GBP

Financial assets

Trade and other receivables 66,600

66,600



44 Capital Management For the purpose of the Company's capital management, capital includes issued capital and other

equity reserves. The primary objective of the Company’s Capital Management is to maximise

shareholders value. The Company manages its capital structure and makes adjustments in the

light of changes in economic environment and the requirements of the financial covenants.

The Company monitors capital using debt to equity ratio. (H in Lacs)

Particulars As at March 31, 2018

As at March 31, 2017

As at April 1, 2016

Non-Current Borrowings 7.13 209.29 400.00

Current Borrowings 587.36 1,285.00 8,292.06

Current maturity of long term debt 202.17 201.97 203.34

Gross Debt 796.65 1,696.26 8,895.40

Total equity 1,012.11 (431.91) (3,435.73)

Adjusted Net debt to equity ratio 0.79 (3.93) (2.59)

45 Employee Benefits The Company contributes to the following post-employment defined benefit plans in India.

(i) Defined Contribution Plans:

The contributions to the Provident Fund and Family Pension Fund of certain employees are

made to a Government administered Provident Fund and there are no further obligations

beyond making such contribution.

The Company recognised H6.40 lacs for year ended March 31, 2018 (H4.31 lacs for year

ended March 31, 2017) provident fund contributions in the Statement of Profit and Loss.

The contributions payable to these plans by the Company are at rates specified in the rules

of the schemes.

(ii) Defined Benefit Plan:

Gratuity

The Company participates in the Employees Gratuity scheme, a funded defined benefit

plan for qualifying employees. Gratuity is payable to all eligible employees on death or on

separation / termination in terms of the provisions of the Payment of Gratuity Act, 1972.

The most recent actuarial valuation of plan assets and the present value of the defined

benefit obligation for gratuity were carried out as at March 31, 2018. The present value of the

defined benefit obligations and the related current service cost and past service cost, were

measured using the Projected Unit Credit Method.

(A) (H in Lacs)

Particulars Gratuity


Defined benefit obligation 56.15 48.15 25.60

Fair value of Plan Assets at the end

of the year

39.55 23.31 21.02

Net Obligation at the end of the

year

16.60 24.84 4.58



(B)

Mo

vem

en

t in

ne

t d

efi

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t (a

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reco

ncili

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n f

rom

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e o

pen

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bal

ances

to t

he c

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ng

bal

ances

for

net

defin

ed

ben

efit

(as

set)

liab

ility

an

d it

s co

mp

on

en

ts:

(H in

Lac

s)

Par

ticu

lars

Gra

tuit

y

Defi

ned

ben

efit

ob

ligat

ion

Fair

val

ue

of

pla

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et d

efin

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Mar

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--

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C) Plan assets

Plan assets comprise the following:

D) Defined benefit obligations

i) Actuarial assumptions

The following were the principal actuarial assumptions at the reporting date (expressed as

weighted averages).

ii) Sensitivity analysis

Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions,

holding other assumptions constant, would have affected the defined benefit obligation by the

amounts shown below.

(H in Lacs)


Fund managed by Insurance

Company

39.55 23.31 21.02

39.55 23.31 21.02


Discount rate 7.88% 7.36% 7.96%

Expected Rate of Return on Plan

Assets

7.88% 7.36% 7.96%

Salary escalation rate 5% 5% 5%

Employee Turnover 2% 2% 2%

Mortality rate N.A. N.A. N.A.

Indian Assured

Lives Mortality

(2006-08) Ult.

Indian Assured

Lives Mortality

(2006-08) Ult.

Indian Assured

Lives Mortality

(2006-08) Ult.

Assumptions regarding future mortality have been based on published statistics and mortality

tables.


Increase Decrease Increase Decrease

Discount rate (1% movement) (4.01) 4.58 (4.01) 4.62

Future salary growth (1% movement) 4.67 (4.16) 4.68 (4.14)

Rate of employee turnover (1% movement) 0.66 (0.75) 0.43 (0.52)

The sensitivity analysis above have been determined based on a method that extrapolates the

impact on defined benefit obligation as a result of reasonable changes in key assumptions

occurring at the end of the reporting period.



Expected future cash flows

The expected future cash flows in respect of gratuity as at March 31, 2018 were as follows

Expected contribution

The expected contributions for defined benefit plan for the next financial year will be in line with

the contribution for the year ended March 31, 2018, i.e. H14.36 lacs

Expected future benefit payments (H in lacs)

March 31, 2019 1.21

March 31, 2020 1.83

March 31, 2021 1.91

March 31, 2022 28.00

March 31, 2023 1.24

Thereafter 84.23


The Compensated Absences is payable to all eligible employees for each day of accumulated

leave on death or on resignation. Compensated Absences debited to Statement of Profit and

Loss during the year amounts to H14.13 lacs (March 31, 2017 H 33.42 lacs) and is included in Note

27 - ‘Other Comprehensive Income’. Accumulated non-current provision for leave encashment

aggregates H193.99 lacs (March 31, 2017 H181.23 lacs and April 1, 2016 H155.54 lacs) and current

provision aggregates H17.05 lacs (March 31, 2017 H16.75 lacs and April 1, 2016 H14.94 lacs).

46 Earnings per share (EPS) Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders

of the Company by the weighted average number of Equity shares outstanding during the year.

Diluted EPS amounts are calculated by dividing the profit attributable to equity holders of the

Company by the weighted average number of Equity shares outstanding during the year plus the

weighted average number of Equity shares that would be issued on conversion of all the dilutive

potential Equity shares into Equity shares.

a) Profit attributable to Equity holders of Company (H in Lacs)


Continuing operations 1,430.48 1,341.31


Company for basic earnings

1,430.48 1,341.31


Company adjusted for the effect of dilution

1,430.48 1,341.31


Issued ordinary shares at April 1 2,65,15,325 2,64,73,525

Effect of shares issued for cash - 41,800

Weighted average number of shares at March 31

for basic and Diluted EPS

2,65,15,325 2,65,15,325

b) Weighted average number of ordinary shares



(H in Lacs)


Basic earnings per share 5.39 5.06

Diluted earnings per share 5.39 5.06

c) Basic and Diluted earnings per share

47 First-time adoption of Ind AS A) Transition to Ind AS

For the purposes of reporting as set out in Note 28, the Company has transitioned the basis

of accounting from Indian generally accepted accounting principles (“IGAAP”) to Ind AS.

The accounting policies set out in note no. 28 have been applied in preparing the financial

statements for the year ended March 31, 2018, the comparative information presented in

these financial statements for the year ended March 31, 2017 and in the preparation of an

opening Ind AS balance sheet at April 1, 2016 (the “transition date”).

In preparing the opening Ind AS balance sheet as at April 1, 2016 and in presenting the

comparative information for the year ended March 31, 2017, the Company has adjusted

amounts reported in financial statements prepared in accordance with IGAAP. An explanation

of how the transition from IGAAP to Ind AS has affected the financial performance, cash

flows and financial position is set out in the following tables and the notes that accompany

the tables. On transition, the Company did not revise estimates previously made under

IGAAP except where required by Ind AS.

B) Exemptions and exceptions availed

1) Ind AS mandatory exceptions

1.1) Estimates

The estimates at April 1 2016 and March 31 2017 are consistent with those made for

the same dates in accordance with the Indian GAAP (after adjustments to reflect

any differences if any, in accounting policies). The Company has made estimates

for following items in accordance with Ind AS at the date of transition as these were

not required under IGAAP:

1) Investment in equity instruments carried at FVTPL;

1.2) Classification and measurement of financial assets

The Company has classified and measured the financial assets on the basis of the

facts and circumstances that exist at the date of transition to Ind AS.

2) Ind AS optional exemptions

2.1) Deemed cost

The Company has elected to continue with the carrying value for all of its property,

plant and equipment, intangible assets recognised in the financial statements as the

deemed cost at the date of transition to Ind AS, measured as per the IGAAP

2.2) Deemed cost for investments in subsidiaries and Joint Ventures

The Company has elected to continue with the carrying value of its investments in

subsidiaries as recognised in the financial statements as at the date of transition to

Ind AS.

Accordingly, the Company has measured all its investments in subsidiaries at their

IGAAP carrying value.



C) Reconciliation between IGAAP and Ind AS:

Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash

flows for prior periods. The following table represent the reconciliation from IGAAP to Ind AS

I) Reconciliation of equity as at April 1, 2016 (H in Lacs)


Amount as per IGAAP


Amount as per Ind

ASASSETS1) Non-current assets





(i) Invesments in Subsidiaries - - -

(ii) Investments 2 4,844.60 (1,695.68) 3,148.92

(e) Non-Current Advance Tax Assets (Net)

176.62 - 176.62


Total non current assets 5,327.02 (1,695.68) 3,631.34 2) Current Assets


(i) Investments 2 29.65 - 29.65

(ii) Trade Receivables - - -


(iv) Bank Balance other than (iii) above 396.46 - 396.46

(v) Loans 162.84 - 162.84

(vi) Other Financial Assets 1,296.19 - 1,296.19

(b) Other current assets 1,065.52 - 1,065.52

Total current assets 3,018.10 - 3,018.10 TOTAL ASSETS 8,345.12 (1,695.68) 6,649.44 EQUITY AND LIABILITIES1) Equity


(b) Other equity 2 (3,067.90) (1,695.68) (4,763.58)

Total Equity (1,740.05) (1,695.68) (3,435.73)2) Non current liabilities


(i) Borrowings 400.00 - 400.00

(b) Provisions 155.54 - 155.54

Total non current liabilities 555.54 - 555.54 3) Current liabilities


(i) Borrowings 8,292.06 - 8,292.06




(c) Provisions 19.53 - 19.53

Total Current liabilities 9,529.62 - 9,529.62 Total liabilities 10,085.16 - 10,085.16

TOTAL EQUITY AND LIABILITIES 8,345.12 (1,695.68) 6,649.44



II) Reconciliation of equity as at March 31, 2017 (H in Lacs)


Amount as per IGAAP


Amount as per Ind

AS

ASSETS



(b) Capital work-in-progress - -


(d) Financial Assets - - -

(i) Invesments in Subsidiaries - - -

(ii) Investments 2 848.92 (697.05) 151.87

(e) Non-Current Advance Tax Assets (Net) - - -


Total non current assets 1,487.60 (697.05) 790.55

2) Current Assets


(i) Investments 14.68 22.04 36.72

(ii) Trade Receivables 428.88 - 428.88


(iv) Bank Balance other than (iii) above 435.35 - 435.35

(v) Loans - - -

(vi) Other Financial Assets 146.71 - 146.71


Total current assets 1,430.23 22.04 1,452.27

TOTAL ASSETS 2,917.83 (675.01) 2,242.82


1) Equity


(b) Other equity 2 (1,086.84) (675.01) (1,761.85)

Total Equity 243.10 (675.01) (431.91)



(i) Borrowings 209.29 - 209.29

(b) Provisions 181.23 - 181.23




(i) Borrowings 1,285.00 - 1,285.00




(c) Provisions 28.99 - 28.99

Current tax liabilities (Net) 334.72 - 334.72

Total Current liabilities 2,284.21 - 2,284.21


TOTAL EQUITY AND LIABILITIES 2,917.83 (675.01) 2,242.82



III) Reconciliation of Profit and Loss Account as on March 31, 2017 (H in Lacs)


No.

Amount

as per

IGAAP

Effects of

transition

to Ind AS

Amount

as per Ind

AS

I. Revenue from Operations 1,695.50 - 1,695.50

II. Other income 262.15 - 262.15

III. Total Revenue (I+II) 1,957.65 - 1,957.65

IV. Expenses

Employee Benefits Expenses 1 179.56 (41.10) 138.46

Finance costs 2.22 - 2.22

Depreciation and Amortization Expenses 12.68 - 12.68

Other Expenses 2 209.11 710.00 919.11

Total Expenses 403.57 668.90 1,072.47

V. Profit/(loss) before Exceptional Items

and taxes

1,554.08 (668.90) 885.18

VI. Exceptional Items 1,049.66 - 1,049.66

VII. Profit/(loss) before Tax 2,603.74 (668.90) 1,934.84

VIII. Tax expense:

1. Current Tax 591.88 1.65 593.53

2. Deferred Tax - - -

3. Tax for Earlier years - - -

IX. Profit/(Loss) for the period from

continuing operations

2,011.86 (670.55) 1,341.31

X. Profit/(Loss) for the period 2,011.86 (670.55) 1,341.31

XI. Other comprehensive income

A (i) Items that will not be reclassified to

profit or loss

Remeasurements of defined benefit

liability (asset)

1 - (41.10) (41.10)

Income tax effect on above - 1.67 1.67

B (i) Items that will be reclassified to

profit or loss

Effective portion of (Loss)/Gain on

hedgeing instrument in a cash flow hedge

- - -

Other comprehensive income (net of tax) - - -

XII. Total comprehensive income for the

period

2,011.86 (709.98) 1,301.88



1) Actuarial gain and loss

Under Ind AS, all actuarial gains and losses are recognised in other comprehensive

income. Under IGAAP the Company recognised actuarial gains and losses in profit and

loss. However this has no impact on the total comprehensive income and total equity

as on April 1, 2016 or as on March 31, 2017. The Employee Benefit Expenses and Other

Comprehensive Income were reduced by H41.10 lacs each.

2) Fair Valuation of Investments

Under IGAAP, Non-Current Investments (including Investments in Subsidiaries) were

carried at cost less provision, if any, for diminution which is considered other than

temporary in nature. Current Investments were valued at lower of cost and fair value.

Under Ind AS, these Investment are measured at fair value. The resulting fair value of

changes of these investments have been recognised in the retained earnings as at the

day of transition and subsequently in the profit or loss for the year ended March 31, 2017

IV) Adjustments to Statement of Cash Flows

There were no material diffrences between the statement of Cash Flows presented under

Ind AS and IGAAP



48

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Statement of Impact of Audit Qualifications (for Audit Report with Modified Opinion) submitted along-with Annual Audited Financial Results for the Financial Year ended March 31,2018 (Consolidated)

I. Sr. Particulars Audited Figures (as Adjusted Figures No. reported before (audited figures aftcr

adj usting for adjusting for qualifiations) qualifiations)

I. Turnover / Total Income 2,484.00 2,264.93

2. Total Expenditure 1,069.00 1,069.00

3. Net Profit / (Loss) 1,4 15.00 1, 195.93

4. Earnings Per Share 5.34 4.51

5. Total Assets 2, 167.80 1,840.30

6. Total Liab il ities 1,155.69 1,3 74.76

7. Net Worth 1,012.11 465.54

8. Any other financial item(s) (as felt appropriate by --- ---management)

II. Audit Qua lification: I ) a) Details of Audit Qualification: The Group has written-back an outstanding payable of Rs. 2 19.07

Lacs as in the opinion of the management the same was no longer payable. Accordingly, loss in Surplus (Profit & Loss) under Other Equity and Other Current Liabilities are lower by the said amount

b) Type of Audit Qualification: Qualified Opinion

c) Frequency of Qualification: First mention

d) For Audit Qualification where the impact is quantified by auditor, Management's views: The management has written-back the said liability as it was no longer payable in the opinion of the management

e) For Audit Qualification where the impact is not quantified by the auditor: i) Management's estimation 011 the impact of audit qualification: Not Appl icable

ii) If management is unable to estimate the impact, reasons for the same: Not Applicable

iii) Auditor's comments on (i) or (ii) above: Not Applicable 2) a) Details of Audit Qualification: The Company had, in an earlier financial year, re-instated 3n advance

of Rs. 327.50 Lacs which was previously written-off as not recoverable. Accordingly, the loss in surplus (Profit & Loss) under Other Equity is lower and Other Non-Current Assets is higher by the said amount

b) Type of Audit Qualification: Qualified Opinion

c) Frequency of Qualification: Appearing since FY ended March 31, 20 17

d) For Audit Qualification where the impact is quantified by auditor, Management's views: The management is in receipt of confirmation from the palty and is confident of recovery of the said amount

in due course.

e) For Audit Qualification where the implict is not qUllntified by the auditor:

i) Management's estimation on the impact of audit qualification: Not Applicable

i i) If Imlnagement is unable to estimate the impact, reasons for the same: Not Applicable

iii) Auditor's comments on (i) or (ii) above: Not Applicable III. Signatories: (

Mr. N. Jayakumar (Managing Director): J "I.u""k. ..L. .-,

Mr. Nikhi l Shah (Chief Financial Officer): ....- '0 Sv-JV ~ ')f /

Mr. Pradip Dubhashi (Audit Committee Chairman) C)fNp.tl ' I'V ~

Mr. Milind Gandhi, Gandhi & Associates LLP, Chartered G~ Jl.v.r -Accountants (Aud itor of the Company) --.

I.

II .

Statement of Impact of Audit Qualifications (for Audit Report with Modified Opinion) submittcd along-with Annual Audited Financial Results for the Financial Year ended March 31, 2018

(Standalone)

Sr. Particulars Auditcd Figures (as Adjusted Figures (audited No. reported before adj usting figures after adjusting for

for q ualifiat ions) qual ifiatio ns) 1. Turnover / Total Income 927.00 927.00

2. Total Expenditure 595.00 595.00

3. Net Profit / (Loss) 332.00 332.00

4. Earn ings Per Share 1.25 1.25

5. Total Assets 7,0 12.68 6,685. 18

6. Total Liab ilities 739.05 739.05

7. Net Worth 6,273.63 5,946. 13

8. Any other financial item(s) (as felt --- ---appropriate by management)

Audit Qualification: I) a) Details of Audit Qualification: The Company had, in an earlier fi nancial year, re-instated an

advance of Rs. 327.50 Lacs which was previously written-off as not recoverable. Accordingly, the loss in Surplus (Profit & Loss) under Other Equ ity is lower and Other Non-Current Assets is higher by the sa id amount

b) Type of Audit Qualification : Qualified Opin ion

c) Frequency of Qualification: Appearing s ince FY ended March 31, 20 17

d) For Audit Qualification where the impact is quantified by auditor, Management's views: The management is in receipt of cOllfinnation fr0111 the party and is confident of recovery of the said amount in due course.

e) For Audit Qualification where the impact is not quantified by the auditor:

i) Management's estimation on the impact of audit qualification: Not Applicable

ii ) If management is unable to estimate the impact, reasons for the same: Not Applicab le

iii) Auditor's comments on (i) or (i1) above: Not Appl icable

Ill. Signatories:

Mr. N. Jayakumar (Managing Director) : ?~ .,. f~ Mr. N ikhil Shah (Ch ief Financia l Officer) : 0>~/'

~ J

Mr. Pradip Dubhashi (Audit Committee (~~a~ Chairman)

Mr. Milind Gandhi, Gandhi & Associates

C~~ LLP, Chartered Accountants (Auditor of the Company) -


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prime - bombay stock exchange · 2018-09-24 · prime septel bel' 24, 2018 rporate...

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